In an era where safeguarding one’s assets and ensuring their seamless transition to loved ones after passing has become paramount, the Living Trust emerges as a beacon of hope and efficiency. At the heart of estate planning, a Living Trust offers a nuanced yet powerful mechanism to bypass the protracted processes of probate, ensuring that beneficiaries receive their inheritance without undue delay or public scrutiny. This invaluable tool not only facilitates the direct transfer of assets as per the grantor's wishes but also provides a cloak of privacy, shielding the estate's details from the public eye. The adaptability of a Living Trust, allowing for amendments in line with the grantor's changing desires, underscores its appeal. Moreover, in instances of incapacitation, it vests a successor trustee with the authority to manage the financial affairs, circumventing the need for court-appointed guardians or conservators. Structured around the principle of revocability and control, the Living Trust empowers individuals to be stewards of their legacy, selecting trustees who reflect their trust and confidence, and delineating duties with precision. Despite its simplicity, the profound implications of establishing a Living Trust—spanning from tax avoidance to probate evasion—echo the sentiments of foresighted asset protection and personalized estate management. With its roots tracing back to medieval times, the evolution of trusts underscores a legacy of safeguarding assets against unforeseen contingencies, making the Living Trust an indispensable component of modern estate planning.
| Question | Answer |
|---|---|
| Form Name | Living Revocable Trust Form |
| Form Length | 60 pages |
| Fillable? | No |
| Fillable fields | 0 |
| Avg. time to fill out | 15 min |
| Other names | trust pdf document, living trust forms download, living trust forms pdf, trust form pdf |
Create Your Living Trust |
1 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
Create Your Living Trust eBook
TABLE OF CONTENTS
……………………………………………………………………………………
Introduction: AN OVERVIEW OF LIVING TRUSTSpg 3
……………………………………………………………………………………
Chapter 1: WHY SHOULD YOU HAVE A LIVING TRUST?pg 4
……………………………………………………………………………………
Chapter 2: WHAT TRUST IS BEST FOR YOU?pg 9
……………………………………………………………………………………
Chapter 3: GETTING ORGANIZED |
pg 13 |
……………………………………………………………………………………
Chapter 4: THE BASICS OF ESTATE PLANNING |
pg 21 |
……………………………………………………………………………………
Chapter 5: EXPERT ADVICE |
pg 26 |
……………………………………………………………………………………
Chapter 6: CHANGING YOUR TRUST |
pg 32 |
……………………………………………………………………………………
Chapter 7: SCHEDULING YOUR TRUST |
pg 37 |
……………………………………………………………………………………
Chapter 8: STAYING SMART ABOUT LEGAL ACTION |
pg 41 |
……………………………………………………………………………………
Chapter 9: TERMS, RESOURCES & RELATED INFORMATION |
pg 49 |
Create Your Living Trust |
2 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
Introduction: AN OVERVIEW OF LIVING TRUSTS
Don't wait another day to draft your Living Trust. The longer you do or the more you depend on a will to protect your loved ones, the more you jeopardize giving control of your assets to a probate court. A Living Trust ensures that your loved ones receive their inheritance when they need it most and as you planned, as well as eliminates the delay of probate. This simple, inexpensive legal alternative helps curtail estate probate charges and expensive attorneys’ fees.
Not to mention, the Living Trust shortens the time it takes to distribute funds to your heirs. Its very presence makes it difficult to contest or overturn your wishes regarding the distribution of your estate. You can take comfort in knowing the Living Trust remains completely private, rather than a public document open to inspection and it can be amended whenever you change your mind.
Taking the time and the initiative to plan can help resolve many of the problems associated with a traditional will and
A Living Trust can be used alone or in addition to a will. Consider if a Living Trust is right for you and, evaluate what trust will best protect your assets. This document contains information, definitions, contacts and resources to help you organize and complete your Living Trust. Don’t hesitate. Explore your options and protect your assets and your loved ones’ best interests!
Create Your Living Trust |
3 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
Chapter 1: WHY YOU SHOULD HAVE A LIVING TRUST
This section answers the questions:
ÜWhat are the advantages of a Living Trust?
ÜHow do you select your trustee?
ÜWhat are some of the duties and responsibilities of a trustee?
ÜWhat is the difference between a Will and a Living Trust
Consider where you keep valuable financial documents like cash, real estate, stocks, bonds, mutual funds. Let say, for the sake of argument, you purchase a giant safe to store them in. You give the combination to a trusted friend or family member, who guards the assets inside the safe and lets you use what you want when you want.
Eventually you pass away, leaving behind your loved ones and the contents of the safe. Shortly thereafter, the person you've entrusted to watch the safe unlocks it and distributes the contents to your family
Does it sound too good to be true? Not only is it possible, it’s strongly advised especially if you have personal assets totaling more than your state probate limit ($30,000 in some states, $60,000 in others). Hard to believe it can be accomplished by something as simple as setting up a revocable Living Trust.
An Overview of a Living Trust
Simply put, a Living Trust is a legal agreement in which a person owning property (the grantor), hands over legal title to a second person (the trustee), who manages it. It's placed in someone else's name to avoid federal estate taxes and probate when you die. Based on your instructions, the trustee has the power to buy, sell, lease, or invest
HINT: Trusts are not a new concept. They have been around since 800 A.D. They've been used by English knights to help protect their lands when they were called into battle. And they came into use in America after the 1700s as a means of helping colonists protect their property from taxes and government.
STOP! Because the trust takes effect while you are alive, it is known as a revocable Living Trust. As the name suggests, you can revoke the trust agreement or appoint a different trustee at any time. Property can be added or removed from the trust as needed. You remain in control of your property, you are merely handing the key to someone else to protect the contents.
Create Your Living Trust |
4 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
How Do You Choose a Trustee?
When it comes to serving as your trustee, you may choose a financial advisor or attorney. Then again, you can also serve as your own trustee. And while this may seem odd, it is perfectly legal in 49 states; only New York requires you to appoint a
You should also know that you can appoint someone outside your state as your trustee since residency in the state where the trust is made is not a requirement. However, you need to make sure that your trustees can be easily contacted as they will need to approve any changes made to the trust.
HINT: Even if you are your own trustee, your assets are protected from probate, since legally they are owned by the trust, a separate entity, rather than you.
NOTES: No matter who serves as your trustee, it is advisable to appoint at least one successor.
This will help ensure that in the event of the death of your trustee, someone will be willing and available to carry on your wishes.
Married people often name their spouses
Upon your death, the trustee automatically distributes the assets in your trust to your beneficiaries (people you have selected to receive property in the trust.)
What Are the Duties & Responsibilities of a Trustee?
Trustees must:
• Do anything that is directed by the trust agreement
• Refrain from doing anything which is forbidden by the trust agreement.
•Be familiar with all the terms of the trust
•Buy, sell, lease, or invest property according to your trust instructions
•Maintain records and accurate accounts act as witnesses to changes to the trust
•Act impartially between the beneficiaries of the trust
•Protect the assets of the trust
•Cannot delegate the trust powers or duties except when it is sanctioned by the trust or permitted by statute
•Transfer the trust property to the persons who are lawfully entitled to receive it
Create Your Living Trust |
5 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
NOTES: Trustees are expected to exercise reasonable care in the performance of their duties. In other words, a trustee could conceivably incur liability for negligence. However, the standard of this duty of care can vary between trustees, depending on special directives. For example, someone may be asked to serve as an alternative trustee or trust beneficiaries and not have
Reviewing this information, you might ask yourself why do you need a trust, especially if you already have a valid will. As you consider this question, take a few minutes to review the reasons below:
9 Reasons for Establishing a Living Trust
1)You avoid probate. Most states require individuals with assets of $30,000 or more (or over $10,000 in real estate) to have their estates formally probated when they die. In some states this figure may be as low as $10,000; in other states, only estates with $60,000 or more in assets need go through the probate process.
Now don't think simply because you have less than $30,000 in your account now that you can skip a Living Trust. Because, while you might not have $30,000 in assets now, a lot can happen before your death. Inflation tends to drive up property values. In fact, property worth only $15,000 today may have doubled in value by the time
your will is read, putting you over the probate limit. So, as you can see, it is smart to plan ahead, and a Living Trust lets you do just that.
Of course, a Will still has its purpose. Parents need a Will to designate guardianship over minor children; people owing or owed money may also have to file a Will. However, for most estates, property distribution is much more easily accomplished with a trust.
2)You avoid federal estate taxes. Whether or not you put your assets in a trust, the Economic Recovery Act of 1981 allows for a federal tax exemption (called the Unified Tax Credit Exemption) on all estates. But if you are married
and your estate exceeds this exemption, or if your estate appreciates in value by the time you die, your heirs may face considerable federal estate taxes without the help of a carefully prepared trust.
Create Your Living Trust |
6 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
NOTES: Your income taxes are unaffected by a Living Trust. Since the trust is revocable (it only becomes irrevocable upon your death), the I.R.S. does not view it as a permanent entity, and hence does not charge you additional taxes.
Because the I.R.S. does not recognize a Trust, you do not need a separate tax I.D. number for it. As expected, you pay taxes on the property in the trust. And upon your death, your heirs will save a bundle on federal estate taxes.
3)A trust is hard to challenge in court. One of the biggest risks associated with filing a Will is that someone may challenge its validity in court. It may be someone who has been left out of the will or who received much less than he or she expected. The embarrassment, cost and nuisance of such cases can be avoided if you set up a Living Trust.
HINT: The goal is to take as much money out of your name as possible, keeping it from the I.R.S. and other agencies so your beneficiaries will inherit it instead.
Unlike a Will, which comes into play after your |
NOTES: A Trust may not totally |
death, a Living Trust is administered with your |
shield you from creditors. Although in |
approval, during your lifetime, leaving little doubt in |
some cases a Trust may protect your |
anyone’s mind as to how you want your estate to be |
assets in a |
managed. Therefore, it's difficult for someone to |
protection of a Trust is, at best, limited. |
claim that the trust is a fraud or that you were |
However, your assets may not be taken |
incompetent when it was formed. And since the |
if your trustee owes money to |
Trust becomes irrevocable upon your death, no one |
creditors; only your debts may be |
can interfere with the distribution to your intended |
applied to the trust. |
beneficiaries. |
|
4)Privacy is assured. One challenge with probate is that any interested party may see
what you left to whom simply by looking up your will at the local probate court. This cannot occur with a Trust, since the schedule of assets itself does not have to be publicly filed.
5)You remain in control of your assets. A Trust guarantees that your beneficiaries are provided for. It also gives you full use of your assets while you are alive, although if there are
Create Your Living Trust |
7 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
While it is wise to appoint someone financially knowledgeable as a trustee (or successor trustee), you must be sure that person will carry out your wishes as you instruct. Many people solve this by appointing one professional
NOTES: Remember, so long as you are alive and competent, you can change your trust at any time. Trusts may be broken. Don't feel you are giving up control of your belongings by forming a trust. If anything, you are gaining control by ensuring your assets will go where you want them to.
6)A trust provides conservatorship rights. Property is not the only thing a trust protects. You may provide for conservatorship through a Living Trust, meaning you name a person to make your important healthcare decisions and manage your property if you are incapacitated. This very important aspect of a Living Trust.
7)
8)Trusts are legally recognized. Trusts are legally recognized in all 50 states. However, trusts may be regulated differently from
9)The best news of all: trusts are easy. Living Trusts cost little and are easy to form. This is especially true if you research trusts and decide what type you need before you consult an attorney. The point of this book is to help you do just that.
Create Your Living Trust |
8 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
Chapter 2: WHAT TRUST IS BEST FOR YOU?
This section answers the questions:
ÜWhat are Unified Tax Credit Exemptions?
ÜWhat are dower and curtesy requirements?
ÜWhat states are dower and curtesy states?
ÜWhat are the community property state guidelines?
ÜWhat states are community property states?
ÜWhat's a Testamentary Trust?
ÜWhat's an Insurance Trust?
ÜWhat's a Totten Trust?
ÜWhat's the Irrevocable Living Trust?
ÜWhat's the Spendthrift Trust?
ÜWhat other Trust exits?
ÜWhat rights do unmarried couples have when it comes to forming a trust?
Trusts can be as varied as individuals. This guide includes a basic single Living Trust for an individual or married couple whose estate is valued at less than the Unified Tax Credit Exemption (see chart below). If you have assets valued at more than the Exemption, there are two popular trust options to consider: the
What is the Unified Tax Credit Exemption?
With the Economic Recovery Act of 1981, $600,000 was the amount established as the maximum value allowed for exemption of one person’s estate. A couple could combine this amount, for a total limit of $1.2 million.
As of January 1, 1998, this amount began to increase gradually and will continue to do so until 2006 when a maximum of $1 million ($2 million per couple) is reached. You can refer to the following chart to see the amount allowed for exemption each year through 2006:
Unified Tax Credit Exemptions
|
YEAR |
|
|
SINGLE |
|
|
COUPLE |
|
|
|
YEAR |
|
|
SINGLE |
|
|
COUPLE |
|
|
$600,000 |
|
$1,200,000 |
|
2002 |
$700,000 |
|
$1,400,000 |
|
|||||||||
1998 |
|
$625,000 |
|
$1,250,000 |
|
|
2003 |
|
$700,000 |
|
$1,400,000 |
|
||||||
1999 |
|
$650,000 |
|
$1,300,000 |
|
|
2004 |
|
$850,000 |
|
$1,700,000 |
|
||||||
2000 |
|
$675,000 |
|
$1,350,000 |
|
|
2005 |
|
$950,000 |
|
$1,900,000 |
|
||||||
2001 |
|
$675,000 |
|
$1,350,000 |
|
|
2006 |
|
$1,000,000 |
|
$2,000,000 |
|
||||||
Create Your Living Trust |
9 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.
What Are Dower & Curtesy Requirements?
Adower is the portion of property due the wife by law; a curtesy is the property due a husband. Several states have laws requiring grantors to leave a certain amount of money to their spouses. In these dower and curtesy states, spouses are required to leave a minimum of a third to half their property to their surviving spouse. Such laws overrule any contrary conditions set forth in a Trust.
For example, if you live in a dower state and designate that no more than 10 percent of your property should go to your husband, the state will ignore your wishes and give
NOTE: Hawaii, Kentucky, Massachusetts, Michigan, Ohio, and Vermont are dower and curtesy states. Consult an attorney if you live in any of these states and plan to set up an
What Are Community Property State Guidelines?
In community property states, all money earned by a husband and wife during their marriage, and all property bought with that money, is divisible into two equal portions.
NOTES: Community property states include: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin.
In most community property states, if a husband and wife commingle their property (put all their money in one joint bank account) that property is considered community property. For example, if you want an asset (a grandfather clock heirloom) not to be considered community property, you must keep it out of the Trust and legally declare it to be separate property.
If you live in a community property state, consider forming two separate trusts, one in your name and the other in your spouse’s.
What Is a Testamentary Trust?
Unlike a Living Trust, the Testamentary Trust doesn’t take effect until after you die. It functions similar to a Will, designating who you want your property to go to. For example, you may designate that your money first goes to your children during their lifetime, and then the remainder goes to your grandchildren as they reach a specific age.
One of the problems with a Testamentary Trust is that it must go through probate. So unless your total estate is quite small, this is one long, expensive process you want to avoid. Living Trusts avoid probate, and for this reason, they tend to be superior to Testamentary Trusts. People with estates below the Unified Tax Credit Exemption may be able to distribute their property using a will and Testamentary Trust. Most people, however, should consider a living trust.
Create Your Living Trust |
10 |
This product does not constitute the rendering of legal advice or services. This product is intended for informational use only and is not a substitute for legal advice.
State laws vary, so consult an attorney on all legal matters. This product was not prepared by a person licensed to practice law in this state.