Estate planning is frequently postponed until it is too late. They might believe it’s only for affluent people, think it’s complicated, or find it challenging to think about death. But every person has an estate, no matter how small, and estate planning is not just for the dead. You can decide what happens to your property while you’re alive and after you pass away by setting up a living trust. So, how can an estate planning attorney help to create a living trust?
What is a living trust?
A living trust is a legal document that, like a will, enables you to designate who will receive your possessions when you pass away. The assets you place in a living trust are “owned” by the trust while still being under your control. Most purchases can be included in a living trust as long as they have value. You might list your house, bank accounts, jewelry, or stocks, for instance. A living trust can also designate a custodian to oversee gifts left to your minor children or to plan for caring for your pets after your passing.
Contrary to a will, however, the beneficiaries—the people you’ve designated to receive your assets—do not have to go through probate before receiving assets held in Living trusts. And by doing this, you can spare your loved ones from frequently drawn-out, expensive, and public processes.
How does a living trust work with an estate planning attorney?
A “grantor” establishes a living trust by naming a “trustee” in a legal document known as a “Declaration of Trust.” The trustee will hold the trust’s assets and manage them to benefit the trust’s beneficiaries while adhering to the grantor’s rules and instructions. The grantor then gives the trustee ownership of their property to pay for the faith.
As the grantor of a living trust, you may appoint yourself as the first trustee. This means that until your death, you retain complete control over the assets held in the trust (also known as the “trust corpus”). A “successor trustee” you’ve chosen will then take control of the faith and distribute its assets to its beneficiaries. The trustee is comparable to the executor of a will in this way.
How will an estate planning attorney help to create a Living Trust?
The steps to creating your living trust are as follows:
Finish the trust agreement
A declaration of trust is the legal document that establishes the trust. There are two ways you can succeed. One is to have a lawyer draught the living trust for you. The alternative is to acquire and complete a live trust form.
Once it is, complete the sections requesting your name and the names of your trustees, successor trustees, and beneficiaries. Next, utilize your asset list to add property descriptions to the trust and specify who will get what after your death. Once the trust document is complete, locate an estate planning law firm to review it and ensure that it complies with state regulations and serves your interests.
The trust document must be signed and notarized.
Before your trust is legally enforceable, most states demand your signature and a notary endorsement. A notary public is available at your local bank branch or in a print and mail facility that provides notary services. In addition, since many attorneys, legal assistants, and paralegals are also notary publics, if you hire an attorney, you will have easy access to a notary.
Transferring assets to the trust
Your trust won’t work unless you take this action. Unfortunately, it is also the step-in trust formation that requires the most time and attention to detail. Still, it will go more smoothly if you have collected your titles and certificates beforehand.
You will change it from you to yourself as trustee when you change ownership, for example, from “Anna Smith” to “Anna Smith Revocable Living Trust, dated March 1, 2021.” Use a quitclaim deed to create a new act naming the Living trust as the real estate owner. Only transfer high-value assets, such as stocks, bonds, homes, and real estate, during this time. Leave out the car unless you want it to be passed on to a specific person or it is a precious classic car. Ask your broker or agent to help with the transfers for your stock, bond, and other brokerage accounts.
Transferring business interests into the trust
You might think about including your small business in the trust if you want it to continue even after your passing. Name the company in the faith and transfer the assets as you would other property types for a sole proprietorship (one-person business). However, you can only share your ownership interest in the trust if you are a partner in a partnership. The partnership agreement must be changed to reflect this transfer, making the trust the partner rather than you. For corporations, you must revoke your initial ownership certificate and request a new one from your board of directors for the faith.
Keep your living trust document safe.
Once the living trust agreement has finished, the property will transfer. Store it in a safe location, such as your home’s fireproof safe or a safe deposit box. Keep the certificates and titles in the exact place (with the trust now listed as the owner). Give beneficiaries, successor trustees, and other trustees copies of the trust agreement.
Draft supplemental documentation
Even if you create a living trust, you still need a last will and testament. You can transfer property outside the faith or name a guardian for minor children if the trust does not cover the surplus property.
Online templates will be available, or you can ask an estate planning lawyer to draught one in addition to the trust. Consider including Living wills, healthcare powers of attorney, durable powers of attorney, and advance directives in your estate plan.
How will an estate planning attorney help you in making a living trust?
Even though setting up a living trust is relatively simple, working with an estate planning attorney may still be beneficial. An attorney can assist you in ensuring that your living trust will be set up correctly. That integrates with the rest of your estate planning documents. As a result, you can take the proper steps to reduce taxes and avoid probate.
An estate planning attorney can help you ensure your legacy. Thus, reducing any hassle for your heirs and beneficiaries. Whether you need a living will, trust, power of attorney, or all of the above.