Answers to Frequently Asked Questions About Living Trusts
Living trusts can be highly useful estate planning tools for people in all types of financial situations. Below are answers to some of the questions we most frequently receive about these trusts.
Q: Why is a living trust beneficial for my estate plan?
One advantage associated with a living trust is that any property you leave through it will be able to bypass the probate court. This might save your loved ones a time and money and enables them to access their inheritance much more quickly than they otherwise would. A more important advantage is that if all of your assets are in a living trust at a time you become incapacitated and unable to manage you’re affairs, you have a trustee set up to manage your assets for you thereby avoiding the appointment of a court-appointed guardian. Guardianship proceedings are much more costly than probate.
Q: Is it difficult or expensive to establish a living trust?
A standard living trust is not much more complicated than a will. While there is some tedious paperwork associated with the process, you’ll find the process to be relatively simple if you work with an experienced estate planning attorney.
Q: Will the contents of my trust be made public?
No. Unlike a will, the trust document will rarely become a matter of public record, as it does not need to be submitted to the probate court.
Q: Does a living trust replace a will?
No, you should still have a will if you create a living trust. The will can be an effective backup tool to cover any property you do not place in the trust. Otherwise, without a will, any property not transferred through your trust will pass down according to Florida’s intestate succession laws. This may not be in accordance with your wishes.
Q: Will a living trust help me reduce my estate tax burden?
No, living trusts leave you as the owner of the property because the contents are revocable. You would need to establish an irrevocable trust to reduce your estate tax burden. You can use the same tax planning techniques in a will or in a trust.
The bottom line is that the decision as to whether a simple will or a trust with an accompanying will is best for you is a complicated one. You should consult with an experienced estate planning attorney.
To learn more about living trusts, consult a skilled Tampa estate planning lawyer with BaumannKangas Estate Law.