When you pass away, you will want your property and savings to be distributed according to your plan, not someone else’s plan. At Black & LoBello, we understand that not one estate plan fits all. Our attorneys will provide you with a customized and individual plan for your estate.
What Is A Trust?
A trust is an agreement that provides for the management of property and involves at least three parties:
- The Trust Maker, sometimes referred to as the settler or grantor, is the person who creates the terms or rules of the trust;
- The Trustee is the person who agrees to accept the Trust Maker’s property and manage it as directed by the trust, and;
- The Beneficiary is the person who receives the benefit of the property held in the trust. Typically, this is the Trust Maker during his lifetime and the children of the Trust Maker when the trust terminates.
The Revocable Living Trust Document
A Revocable Living Trust (RLT) is a trust document created during the Trust Maker’s lifetime. An RLT is often referred to as an inter vivos trust, which means during life. The trust is revocable due to the Trust Maker’s ability to terminate and amend the trust.
The Trust Maker generally names himself/herself as the Trustee and the beneficiary of the trust while still alive. The Trust Maker also names Trustees to act for his/her benefit in the event of disability or death to manage the assets of the trust following the Trust Maker’s death. Typically the Trustee is also charged with the responsibility of settling the obligations of the trust and distribution to the beneficiaries.
Funding The Trust
After executing a revocable living trust, the Trust Maker then needs to fund the trust. Funding is the process through which the individually-owned assets of the Trust Maker are titled and transferred into the trust. If assets are not placed into the trust, the Trustee lacks authority to manage the assets, since the Trustee only has authority with respect to assets contained within the trust.
In Community Property states, such as Nevada, married couples can create a joint revocable living trust. The married couple will each re-title their property into the name of their trust, which creates a funded trust.
Re-titling is performed in different fashions for different assets. For example, a checking account held in the name of John and Mary Sample will be funded into the Sample’s Revocable Living Trust by re-titling it as John Sample and Mary Sample, Trustees of the Sample Living Trust dated (the date the trust is signed.)
A similar action will be taken in regard to all of their other assets, such as real estate, automobiles, boats, investment accounts, securities, and any other asset with a title. Assets that do not have titles will be transferred into the trust by an assignment of personal property. An assignment of personal property is a document, which demonstrates the Trust Maker’s intention to transfer all of property without title into his/her revocable living trust.
Once the revocable living trust has been funded, it will control all of the assets in its name. Inversely, a trust will not control assets not titled in its name. A well drafted revocable living trust will not only include direction on how to manage property, but also give instructions for how the Trust Maker or the Trust Maker’s family and loved ones are to receive the benefits of the trust. The trust also makes provisions for how the Trust Maker is to be cared for in the case of the Trust Maker’s disability and/or death.
A well-written living trust document will outline the Trust Maker’s financial and personal intentions, be clear in its directives and be protectively locked within the law.
Related Practice Areas
Asset Protection • Charitable Remainder Trusts • Education Trust • Elder Law • Guardianships • Irrevocable Living Trusts • Last Wills and Testaments • Living Wills (Directive to Physicians) • Medicaid Planning • Offshore Trusts • Powers of Attorney • Probate • Revocable Living Trusts