What Is a Living Trust?
A living trust is a legal arrangement that’s established to hold and manage your assets. Living trusts take effect while you are still alive, as opposed to a trust that is established through a will and takes effect after your death.
Living trusts generally involve three main parties:
- The grantor is the person who creates the trust and transfers their assets into it.
- The trustee is the person appointed by the grantor to manage and administer the trust according to its terms. In a living trust, the grantor typically serves as the first trustee and appoints a second trustee to succeed them after their death.
- The beneficiaries are the people who are designated to receive the assets held in the trust according to the trust’s terms and instructions.
Types of Trusts
There are two different kinds of living trusts:
Revocable Trusts
A revocable trust can be modified, amended, or revoked by the grantor during their lifetime. The grantor retains control over the assets in the trust and has the ability to make changes to the trust’s terms and beneficiaries or even dissolve the trust entirely.
Irrevocable Trusts
An irrevocable trust is a trust that, once created, cannot be modified, amended, or revoked by the grantor.
Benefits of Putting Your House in a Living Trust
Including your house in a living trust has numerous advantages:
1. Avoid Probate
Assets held in a living trust typically pass directly to the beneficiaries you’ve designated in the trust document, bypassing the need for probate court proceedings. Probate can be a time-consuming and costly process, so avoiding it can save your loved ones from unnecessary hassle and expenses.
2. Protect Privacy
Unlike a will, which becomes public record during probate, a living trust allows for a higher level of privacy. The distribution of your assets and the terms of the trust can remain confidential since it does not go through the probate process.
3. Retain Control
A living trust allows you to establish detailed instructions for the management and distribution of your assets. It also provides a mechanism for managing your assets in the event of your incapacity. If you become unable to manage your affairs before your death, the successor trustee you’ve designated can step in to manage the trust without court intervention.
4. Potential Tax Benefits
A living trust can be a useful tool for implementing tax planning strategies for larger estates that are subject to estate taxes. While estate tax laws vary depending on the jurisdiction, certain provisions within a living trust may help reduce the tax burden on your estate.
How to Find an Estate Planning Attorney in Fort Myers
Hampton Law offers estate planning services to several locations in Southwest Florida, including Fort Myers, North Fort Myers, Cape Coral, Bonita Springs, Estero, and Sanibel.
Estate planning can be an overwhelming process. At Hampton Law in Fort Myers, our attorneys work with you directly to help you structure your estate and ensure the safe transfer of your assets.
