A revocable trust offers you many potential benefits, two of which are: (1) avoiding the need for probate upon your death; and (2) avoiding the need for a conservatorship in the event you become incapacitated. However, unless your revocable trust is "funded," it will be of little value. Failing to fund a revocable trust is a common mistake. (See our blog post, “3 Common Estate Planning Mistakes (and How to Avoid Them.)
To “fund” a trust simply means to transfer your assets into the trust by changing the titles on accounts, property, or by beneficiary designations.
When you meet with one of our estate planning attorneys and decide that you want a revocable trust, we will review your assets with you and advise you as to which assets should be transferred to your trust, which assets should name your trust as beneficiary, and which assets should be excluded from the trust.
Our attorneys and staff have extensive experience with the specific paperwork necessary for transfers of property, transfers of accounts, beneficiary designations, and other actions needed to fully fund your trust. Assisting you in the funding of your trust is an important part of our estate planning services.
Funding a revocable trust during your lifetime does not create complicated tax consequences. The assets in the revocable trust are still reported as your personal assets for tax purposes, and any gains or losses are still recorded using your social security number.
We often see trust documents which have been created with care, but they don’t accomplish what the client intended because the client’s assets are still in his or her individual name. If you have a revocable trust but do not take steps to transfer the ownership of your assets into your trust or create a beneficiary designation, then those assets will still be subject to the probate process upon your death.
If you would like to speak to one of our attorneys about your estate planning needs, including establishing a revocable trust, please contact us today. If you already have a revocable trust, but are unsure if it is up to date or if it has been fully funded, we would be glad to talk to you about that.
Call us: (417) 882-2828