A trust can indeed be a great way to avoid probate. To do so, however, it must be set up correctly, and your Tampa, FL trust lawyer can make sure things are done legally and exactly according to your wishes.
How a Trust Avoids Probate
When you set up a trust, you are essentially creating a legal entity in which to put some of your assets. Once you transfer assets from your direct and immediate control as part of your estate into the trust, they are no longer owned by you. They are owned by the trust. When you pass away, all the assets of your estate have to go through probate, but since the assets you put in the trust are owned by the trust, and the trust did not “die,” nothing in the trust goes through probate.
In most cases, you will name yourself as trustee of the trust, which means you still have control of the assets. You will also establish a successor trustee who will take over if you become incapacitated or when you pass away, and your passing away is the trigger event (in most cases) for the trust to be dispersed in the manner you’ve set up.
Types of Trusts
The Revocable Living Trust
This is the most popular option for the average person and estate. Most commonly, you would appoint yourself as the trustee of this trust so that you keep full control. You can revoke this trust at any time while you’re still alive, or you can change or amend it. However, the assets in this trust remain part of your estate for tax purposes and have some vulnerability if a lawsuit is brought against your estate.
The Irrevocable Trust
This trust also avoids probate for the reasons given above, but these trusts cannot be changed once they’re made. They offer greater tax benefits and more creditor protections, but they are very inflexible.
There are other types of trusts that are useful in specific situations. A lawyer can tell you more.
Best Practices for Setting up a Trust
Talk to a Tampa, FL Trust Lawyer
Most people will find the technicalities and legalities surrounding trusts to be difficult to work through. Your lawyer will know all the rules and how to ensure your trust is set up properly. An experienced attorney will also be able to tell you all the trust options and help you choose the best ones for your family and estate.
Don’t Forget to Review
Many people set up a revocable living trust and then forget about it. It’s important not to do this: it needs to be reviewed periodically and definitely after any major life change, such as the birth of a new child, a death in the family, divorce, or marriage. You may also need to review it if there’s a major change to your financial circumstances.
To learn more about trust and what’s best for you, contact the Law Office of Elizabeth Devolder in Tampa or Sarasota today.
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