Drafting wills are generally useful for naming heirs and transferring or distributing inheritance to would be surviving spouse, children, or grandchildren of a decedent. However, a last will and testament is not the only estate planning tool that will enable a deceased person to transfer or to distribute estate assets (to a family member or heir). An experienced Calabasas estate planning lawyer can explain to you the advantages of setting up other estate planning documents.

How establishing a trust works

When you set up a trust, you (the grantor) will appoint a trustee who will be managing and administering assets in a trust account based on your estate plan. This means that you will determine how the property in trust shall be managed, both while you are still alive and when you die. This is useful for both the grantor and beneficiary of a trust.

Under relevant trust law, after setting up a trust, estate assets are placed in the name of the trust. As such, any bank account, personal property, or real property held in trust is no longer owned by the grantor but is owned by the trust.

The trustee in a trust you set up can be a loved one, a bank, or a trust company. Grantors themselves can administer and be appointed as trustees. However, there are instances when this could not be the best choice:

If you have no idea what a revocable trust is

If you are the initial trustee of a revocable living trust, it is your responsibility to manage, invest, and distribute assets in the trust account. Keep in mind that creating a trust is one thing and managing assets in the name of the trust is another. Trust rules can be quite confusing. Here, someone with the knowledge and skills on managing, investing, and transferring property in a trust would be a better option. A hands-on Calabasas estate planning lawyer can explain this in more detail.

When you can foresee incapacity in the next few years

Before you pass away, there could be a time when you can no longer manage or invest in trust property. If you created a trust at an advanced age, such ‘incapacity’ could be a reality sooner. Here, you can either appoint a successor trustee (who, under trust law, could step in and continue to manage and invest the trust without court involvement) or appoint someone else as the trustee (and you will simply be a beneficiary of the trust account).

If you established a trust to ‘simply’ be a beneficiary

While a trustor might have the ability to manage, invest, and distribute trust property, there are cases when the individual who creates a trust simply does not want that responsibility. Instead, they prefer to appoint a trusted loved one or trust company to be the one in charge of managing, investing, and using property held in trust for the beneficiaries of the trust documents.

When you create a trust, you will essentially be able to carry out your plans for your estate and have it managed for the benefit of trust beneficiaries while you are still alive. This is preferable if you want to benefit from income from trust assets throughout the remainder of your lifetime, minus the stress.

Different trust forms for different needs

There are various types of trusts for various circumstances. Revocable trusts, for instance, could be amended or revoked. Because of certain provisions of state law, such a living trust is also ideal if you want your trust beneficiary to avoid probate. They help avoid probate because the assets of the deceased will no longer be brought to court and probated after death. To make all these less confusing, contact a trusted Calabasas estate planning attorney from a law office that specializes in trusts and estates.

For questions on a revocable or irrevocable living trust, credit shelter trust, succession, or probate and estate taxes, contact our law firm. Call our Calabasas estate planning attorneys at Moschetti Law Group for reliable estate planning services.

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