Reducing Probate With Revocable Trusts
Advertisements on how to avoid probate are almost unavoidable and give the impression that you can arrange for your estate to flow seamlessly to your beneficiaries immediately after your death. In spite of the impression given by this misinformation, probate is not entirely evil and usually cannot be completely avoided, but you can employ methods to keep some of your estate from being probated by careful and timely use of deed transfers and revocable trusts. A revocable trust, also often referred to as a "living trust," is a useful means of transferring your property without going through probate. Read on for what you need to know about reducing the need for probate with a revocable trust.
Similar to a will, a revocable trust is a legal document that directs certain assets to be placed into a legal entity; a trust. The trust specifies that (some types of) stocks and bonds, real estate, art, vehicles, jewelry, etc. reside in the trust until the owner dies. Almost anything that can be addressed in a will can also be placed in a trust.
Like a Will
The similarities to a will continue with the naming of beneficiaries of the property placed in the trust. The owner of the trust can make changes anytime: removing and adding assets, change beneficiaries and doing away with the trust altogether, if wished. The trust's owner will appoint a trustee to administer the trust once they become incapacitated or die, and they fill a similar role to that of a executor or personal representative.The trustee is tasked with the distribution of assets as set forth to the beneficiaries and to manage the financial affairs of the deceased, such as paying taxes and preparing property to be sold.
Better Than a Will
Once the owner of the trust passes way, the remarkable differences between a trust and a will become readily apparent. Unlike the property addressed in a will, the property in a trust passes immediately to the beneficiaries, without the need to go through the process of probate, which can take many months to complete. Moreover, the contents of a trust are entirely private; only the trustee (and the estate attorney) actually knows what property is passing to what beneficiary. The benefits of this privacy factor with a trust are two-fold:
A will is published in the local paper and could invite unwelcome attention, which can be avoided with a trust.
The possibility of discord and conflict between beneficiaries could be greatly reduced.
A revocable trust can play an important part in your estate planning provisions, so contact a probate attorney, such as those at Leon J Teichner & Associates, P.C., to get more information about the benefits of using trust instruments.