A revocable trust is a legal entity created to hold the ownership of an individual assets. A revocable trust covers three phases of the trust maker’s life; mainly while he is alive, possible incapacitation and what happens to his estate after his death. When planning for these phases, it is essential you have a trust law attorney, whom through experience on such legal matters, would guide you, and provide the necessary assistance and backing.
While the trust maker is alive, the trust formation and documents ensures that the trust maker own, control and invest in his assets or estate. Even while a trustee may have appointed with the assets transferred or funded into the trust ownership, the trust maker controls the assets during his life time. He reserves the right to undo a revocable trust, hence, the term revocable. The trust maker can reclaim the assets placed into the trust, sell the assets, or divert to another beneficiary.
A trust attorney would guide you through the next phase of preparing your trust for the future, when cases of incapacitations may come up. The trust document should contain a named successor, someone who would step in and take over management of the estates, make medical decisions as well as financial decisions.
The third and last phase of application of a revocable trust is when the trust maker dies. A revocable trust at this point becomes automatically irrevocable. The trustee now also pays the trust maker’s final bills, debts and taxes, just as he would had it being the he was alive but mentally incapable. A revocable trust, ensures that the named successor or beneficiary of the estate and properties gets the remaining assets as wanted by the deceased.
Revocable Trust avoids Probate
One of the benefits of living trust in Long Island is that it avoids probate even while a valid and clearly written will still go through a court proceeding for your assets to be distributed to the beneficiaries according to your wishes. A revocable living trust doesn’t require probate because the assets has been placed into the trust before the death of the trust maker. Once the assets has been transferred into the trust they will not be considered part of your estate and will not be subject to probate.
A revocable Living trust is different from a will
A revocable living trust is different from will. This distinction can be seen in the way each documents are executed and their benefits. Living trust are legal documents through which you place your assets for protection and also easy transfer of estate to appointed beneficiary called the successor trustee. A will however, is a written legal documents with a plan to distribute your assets upon your death. A named executor as documented in the will oversee this process of reading and implementing the will.
While the living trust can be executed anytime the trust has been funded, the will only takes effect until after your death.
Another major advantage of living trust over will is that it prevents probate, therefore saving time and cost for any legal proceeding on wills.
Revocable Trust prevents unwanted guardianship
In the process of creating a living trust, you name a trustee, who takes over making financial or medical decisions for you when you are unable to dos so. This trust is only implemented when you become incapacitated. A court proceeding would no longer be needed for establishing guardianship and appointing a legal guardian for you. Your trustee as stated in the revocable trust would step into this decision making duty of managing your estate and other affairs.
The revocable trust can be used to hold and protect these documents, also for transfer to beneficiaries
To transfer a house or other real estate property to a living trust in Long Island, a new deed must be made with the local real estate records. In Brooklyn, certain tax transfer forms will have to be filed along with the deed. It’s good you consult a living trust attorney before delving into these waters.
If the house or apartment being transferred is subject to a mortgage, then the mortgage bank must be notified to obtain its approval. If not, then the full mortgage must be paid since the transfer was unauthorized.
Bank and brokerage accounts
Banks and brokerage companies all have their forms and requirements for transferring accounts into trusts. These requirements or rules must be properly investigated before completing the transfer.