What Is A Living Trust?
So, what is a living trust? A trust is arrangement whereby one or more “trustees” manage your property and assets for you. It is usually done to benefit a third party known as a “beneficiary.” While you are officially no longer the owner of the assets that are managed by the trust, you get to set the rules for the management of the trust. You are, also, often an initial trustee of the trust and have control over the management of the property of the trust. A trust is a simple way to manage a group of assets as a single unit with an eye towards distributing the assets to your chosen beneficiaries once you pass away.
A living trust simply means that the transfer of property and assets to the trust fund is done while you are still “living.” In other words, you are planning ahead for specified parts of your assets and estate to be distributed to beneficiaries that you have chosen. Until you pass away, the assets are managed under a set of rules that you have dictated by a trustee that you have chosen. All of the planning and managing is done for the ultimate benefit of the beneficiaries. Upon your death, they will receive the assets in a pre-determined way.
When you establish your trust, you will need to determine whether it will be an “irrevocable trust” or a “revocable trust.”
If you decide to place your assets in an “irrevocable trust,” you will be unable to take those assets back out of the trust. You cease to be the owner of those assets. Once you have made this decision, those assets are essentially owned by the trust.
If, instead, you choose to place your assets in a “revocable trust,” you will have the option of removing those assets from the trust and even terminating the trust in the future. It is not uncommon for the provisions of a revocable trust fund to require for the trust to be irrevocable upon your death or loss of competency.
Opinions vary on the best reasons and methods for using these two types of trust funds. Our attorneys can present the options to you and help you determine what is the most effective for your situation.
Ultimately, the use of some type of trust fund can remove a lot of the burden of decision making during the emotional time of a loved one’s death. Decisions have been made ahead of time without the complications of swirling emotions. Complex issues have been researched and figured out years before. Potential loss of income and assets have already been discovered and addressed. Possible family disputes can be avoided. Estate taxes can be greatly reduced.
At The Law Offices of Justin M. Gilbert, we have the experience to help you properly value your estate and your assets. We know how to administer your trusts within the complexities of family members, advisors, creditors, and the law. We are committed to distributing your assets according to your wishes in an efficient manner. We want your beneficiaries to receive the assets as quickly as possible.
Now that you know the answer to the question “what is a living trust?” you can take the next step. Let us partner with you to help you make these decisions in the way that is most advantageous for you. We are familiar with the processes and the details. We know what the law requires and what the courts are looking for. Don’t leave the care of your loved ones and the distribution of your assets to the whim of the courts.