What is a Revocable Living Trust?
A revocable living trust is a type of agreement included in an estate plan that designates a person who will be responsible for managing your property. Unlike other types of trusts, it can still be managed by the creator while he or she is alive and considered to be mentally competent, and he or she can add or remove property or completely dissolve the trust at any time. Once the creator passes away, it instantly becomes irrevocable.
You can transfer any of your property into a revocable living trust. The person you choose to manage the trust is called the trustee, and is usually a trust company, a close relative or trusted friend of the person creating the trust. The grantor (the person who creates the trust) usually acts as the trustee as well while still alive, as he or she maintains total control over all assets in life. You still have the option to sell the assets, buy more assets, invest your assets or exchange trust assets.
The biggest benefit of a revocable living trust is that it puts in place a plan to manage your assets in the event you become too incapacitated to do so. Usually, if you have a fully funded trust, you will not need a guardianship. Also assets included in the trust are not subject to the probate process in the same way that assets of a will are. Guardianship avoidance and probate avoidance are two of the best reasons to have a revocable trust. This is particularly beneficial for large, valuable and complex estates, as the probate court process and the guardianship court process can get extremely time-consuming and stressful. It also keeps all documents involved in your estate plan private after your passing, unlike a will, which becomes public the moment you die.
Revocable living trusts do not avoid various estate taxes, so if that is your primary goal you will likely want to look for a different method. The property in the trust is also still subject to creditors and lawsuits because you still technically own it as long as you are alive. Although most people seeking protection from creditor claims think a revocable trust will give them that protection, a Florida revocable trust does not give creditor protection.
Speak with a dedicated Tampa estate planning attorney at BaumannKangas Estate Law. to determine if a revocable living trust is the right method for you to handle your estate.