A revocable trust is a legal instrument that allows a settlor to place assets into a trust to be managed by a trustee for named beneficiaries. The individual beneficiaries do not have any right to the assets in the trust corpus until the settlor dies. Once a settlor dies, then the trust assets will be transferred to the beneficiaries according to the terms of the trust.
Avoiding Probate Administration
One of the primary benefits of creating a revocable trust is that it can help an individual avoid probate administration. When an estate is probated it can take months or years for the assets to be distributed to heirs. Most decedents do not want the state to decide how their property will be disbursed upon their death. Therefore, trusts enable individuals to bypass probate administration and save time and money.
The Settlor Has Control Over the Terms of the Trust
A settlor can limit how assets are distributed upon their death. For example, a settlor could state that only funds will be distributed to a particular beneficiary if that beneficiary reaches a specific age. Also, the settlor can decide that only trust property will be used for educational purposes. This flexibility allows settlers to have more control over how their assets are used after their death.
The Settlor Maintains Control Over Trust Assets While They Are Living
A settlor can revoke a living trust and change the terms if the settlor decides to do so during their lifetime. No settlor will be bound by the terms of the revocable trust. It is also helpful that the settlor will have control over trust assets while they are alive. A settlor will be able to alter the trust terms if they prefer to do so due to changed circumstances.
Instructions for Maintaining Property
A revocable living trust may contain specific instructions for managing real property such as commercial or residential real estate. These instructions can ensure that the property will remain in good condition after the settlor passes away. Also, the trust can ensure that the property will not decrease in value due to neglect after the settlor’s death.
Reducing Intergenerational Wealth Taxes
Creating a trust can provide many tax benefits to the estate itself and the beneficiaries. Those who have their property pass through a trust can pay less taxes and save more of their assets. Speaking to a knowledgeable trusts and estates attorney is the best way to determine how tax benefits may apply to your estate.
Contact L. Jennings Law Today to Learn More About Revocable Living Trusts
If you want to learn more about how a revocable living trust can be a part of your estate plan, then contact us today. We have years of experience helping families preserve their assets while reducing their tax burden. A comprehensive estate plan will benefit your family for generations. Contact L. Jennings Law today to learn more about revocable living trusts, living wills, and advance directives for healthcare.