Revocable Trust Lawyer
While people often think that trusts are only tools for the very wealthy, the fact is that many families can benefit from the use of a revocable trust. These are often called living trusts—and some lawyers still use the term “inter vivos” trust.
Most people create revocable trusts to avoid probate, but these trusts serve other useful purposes as well. The Huizenga Law Firm, P.C. can devise the terms of a trust to meet specific needs and goals for your family.
What is a Revocable Trust?
Trusts are legal devices set up to hold property. The person who creates the trust will transfer property into the trust. That person is often referred to as the grantor (since they grant property to the trust) or the settlor. Property moved into the trust is then managed by the trustee, and the property is distributed or used by the beneficiary.
Like the name indicates, a revocable trust can be revoked if you change your mind after creating it. You could also alter the trust or take property out of it. That provides considerable flexibility and makes it much easier to transfer interests into the trust.
Other types of trusts include irrevocable trusts, which cannot be changed, and testamentary trusts, which are set up in a will and do not officially exist until the creator of the will passes away.
How a Revocable Trust Operates
With most revocable trusts, the grantor who created the trust also serves as the trustee and enjoys the benefits as the beneficiary. Trust documents should also nominate one or more successor trustees and successor beneficiaries. These people take over management (trustee) and receive the proceeds (beneficiary) when the grantor passes away.
Because of the revocable nature of the trust, the property in the trust is still considered by many to belong to the grantor, and income from that property is still associated with the grantor’s personal taxes. The grantor can control and use the property in the same way as before it was transferred into the trust.
The Benefits of a Revocable Trust
When the grantor passes away, property in the trust passes to the successor beneficiaries. It does not become part of a probate estate, so there is no need for that property to go through the formal and costly probate process. In addition, the property passes to those beneficiaries through private channels. If the property was instead bequeathed through a will, the provisions would become public knowledge when the will was admitted to probate, and the court would have to oversee the management and distribution of the property, which can take up to a year or more to finalize.
So, people set up revocable trusts so that their loved ones can receive property without the delays and expense of probate. But they often overlook an additional benefit. The trust can be written so that if the grantor becomes incapacitated, the successor trustee can take over and handle affairs on the grantor’s behalf.
Reduce the Burden on Your Family by Creating a Revocable Trust
While most people do not look forward to making plans for their own death or incapacity, they realize it is worse to leave that burden to their families. By creating a revocable trust, you can save your family from uncertainty, expense, and delays after your passing. You give them a means to manage your affairs if an illness or injury renders you unable to make or communicate your own decisions.
Talk to the Huizenga Law Firm to find out whether a revocable trust is the right option for your family.