What Property Can Be Placed in My Trust?
There are many benefits to creating a Revocable Living Trust as part of your estate plan. Benefits include the ability to avoid probate, putting a quick end to the estate administration process.
Although there are many benefits, creating a Revocable Living Trust may not automatically accomplish your goals. In this case, many ask "what property can be placed in my trust"?
Instead, after the trust is created, you’ll need to start the process of “funding” or moving assets into the trust. If this step is missed or an asset is overlooked– say you die without changing the title of your house into the name of your trust—it will need to go through probate, which negates all the planning you did in the first place.
The best way to avoid potential problems is to talk to your attorney about which assets to put in your trust. This ensures that you are clear on your funding responsibilities. The most common items your attorney may suggest to include in your trust consist of:
Real Property
Real estate is the most common type of property that’s put in a trust. When a trust is drafted, a quit-claim deed is often drafted at the same time by the estate planning lawyer to transfer the property to the trust.
Real property makes up the majority of a person’s estate, and having it in the trust can be the difference between going through a full probate process or dealing with a small estate administration.
Bank Accounts
Most solely owned bank accounts should be placed into a Revocable Living Trust, not only to avoid probate but also to allow for ease of access to your funds by your successor trustees if you should ever become incapacitated.
Although this is the case, joint accounts and accounts with beneficiaries do not need to go into a trust for the purpose of avoiding probate.
Automobiles
In most cases, attorneys advise against placing cars and other vehicles into Revocable Living Trusts due to liability concerns and issues that may arise with the Department of Motor Vehicles and auto insurance agencies.
However, exceptions can be made if the automobile in question is an antique or a show car that will not be driven as a daily vehicle, or if it is worth a considerable amount of money.
Small Business Interests
Transferring an interest in a small business into a Revocable Living Trust can be beneficial if you’d like someone to have the ability to immediately assume your business responsibilities after your passing.
Consequently, there may be complications depending on the type of small business structure you have an interest in. It is a good idea to review all of the pros and cons with your lawyer before making a decision.
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If you want to learn more about funding your Revocable Living Trust, or if you want to have your current estate plan reviewed to make sure your trust is properly funded reach out to us directly here and schedule a call with one of our paralegals on our scheduling page here.
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