Shared Living Trusts For Married Couples

By James L Kirkland

If you are planning your own will, you might want to think of other options such as living trust. It will allow you to do the same job as a will, leaving your property to the beneficiaries of your choice. But you can avoid probate by using this method. It is a legal document controlling the transfer of property in the trust after your death. In the document, you will name beneficiaries who are going to receive the trust property. Just like a will, you should name primary beneficiaries for your specific property, residuary beneficiaries, and alternates if any.

For couples, there is an option of creating a shared living trust which will cover the property of both parties. However, it is not a requirement for every couple. If each spouse owns one's separate property, it might be better for each spouse to create an individual living trust rather than having combined one. Generally it is preferable to create single, shared trust in case they share the ownership of the property.

If you are living in a community property state where spouses are equally allowed to own most properties acquired after the marriage, then both of you will probably own the property together. Even in the other state where only one spouse is allowed to have the ownership, spouses who have been married for many years will be considered to have owned the most of all of the property together. In such a case, you are allowed to transfer that property into legal co-ownership when you create your shared living trust.

Same rule can be applied to unmarried couples if they want. They can register any ownership and title document in both their names as co-owners, thus sharing the ownership of the property.

It is not recommended to have two separate living trusts set up for shared property that are owned by a couple. Usually, such a case can cause a problem, ongoing record-keeping burdens as well. Also it could lead to unfair and unbalanced situation. However, no spouse is required to divide the property this way. Using a shared trust, all co-owned property can be transferred. Also you can put individually owned property into the trust, including any separate property if you want. Each spouse has a full power of naming beneficiaries for one's portion of the shared trust property and any other property of his or her own.

In case one of the spouses dies, then the shared living trust will be split into two trusts. One trust contains all of the property of the deceased one, while the other containing all property of the surviving one. The property of deceased spouse will be transferred to the beneficiaries named by that spouse. Generally the beneficiary will be the surviving spouse, but any other parties such as children or friends may also be the beneficiary.

If you are interested, you can use Living Trust Forms to leave your property to your named beneficiaries.

For more information about legal documents, go to Legal Forms site, where you can find many free legal forms and resources including living trust and living will forms that you can use to help transfer your own property and assets.

Back To Contents

Article Source: http://EzineArticles.com/?expert=James_L_Kirkland

What is a Revocable Living Trust?

By Andre Savoie

Living trusts have becoming an increasingly common and popular choice in estate planning in recent years because they offer a unique and smart way to protect your assets both while you are still capable of managing them and after you have passed away or fallen ill. A revocable living trust is a specific type of trust that differs from other trusts in important ways.

Trust versus Will

One of the main things a trust does is replace many of the functions of a will. You may still choose to have a will in addition to the trust to take care of any property that you do not incorporate into the trust. However, the main advantage of a trust as opposed to a will is that it does not need to be filed in probate court, which allows individuals a greater degree of privacy as there is no public record of all the assets in their possession.

A Revocable Living Trust

All trusts are entities into which one transfers their assets. The assets then become property of the trust rather than the individual. A revocable living trust is used so that individuals can put all of their property into a single location, allowing it to be distributed quickly and easily when the time comes for that process. The trust takes effect immediately, which is why it is called "living." The opposite type of trust is called a testamentary trust, and does not take effect until the person dies. At that point, their assets are transferred into the trust for disposal.

Controlling a Trust

In the meantime, most people choose to name themselves as the trustee as long as they are alive and competent, which means that they retain control over their assets even though the trust owns the assets rather than the individual. Revocable trusts can be changed, altered, or even dissolved at the discretion of the person who creates them as long as they are competent, at any time, and for any reason. In this way, this type of trust offers the greatest degree of flexibility while providing the degree of protection and privacy desired by people considering a trust.

To summarize, some of the advantages to a revocable living trust include:

- flexibility to change or dissolve the trust while you're alive

- Ability to serve as the trustee of your own trust

- Privacy because no will needs to be filed

- Savings after death because avoids the costs and delays of probate court

These flexible trusts are a great choice for many people. If you are interested in this or other options regarding trusts and estate planning, it is important to consult someone with knowledge and experience before making these important decisions.

If you want to learn more about revocable living trusts and how they can benefit you and your loved ones, find out why Virginia families have trusted the estate planning attorneys at Flanders and Wade for more than 20 years. Contact them today via their website for more information.

Back To Contents

Article Source: http://EzineArticles.com/?expert=Andre_Savoie

Estate Taxes and Trusts Law

By Carl Gompf

Estate taxes, sometimes called inheritance or death taxes, are levied on property that is passed to heirs after death. The Economic Growth and Tax Relief Reconciliation Act, passed in 2001, reduced federal estate taxes gradually over the past ten years. This year, 2010, there is no tax at all on any estate. However, the tax is scheduled to return in 2011. In 2011 the tax rate will be 50 percent on any estate worth more than $1 million, a figure that is not hard to reach for many people.

Lawmakers are currently debating if the repeal of the tax should be let to stand. Without action by Congress only $1 million of an estate can pass tax free whereas in 2009 decendents could pass $3.5 million tax free.

Estate taxes are payable to the IRS nine months after the date of death. Regardless of the ultimate makeup of any new estate tax law, there are effective ways to reduce estate taxes by the use of trusts. The following is a list of the more common types of trusts:

• Living trusts
• Family trusts or revocable living trusts
• Irrevocable trust
• Special needs trust
• IRA trust
• Income rust

If you have received a recent inheritance, have a special need case involving a minor or incapacitated adult relative, or need assistance with an IRA or other income trust, a skilled trusts attorney can assist you with the various trusts that are available. Trusts law is complex and your lawyer can fully advise you.

Family Trusts - Revocable Living Trust

Revocable living trusts or family trusts are trusts that can be terminated or modified at any time by the grantor for any reason. An irrevocable family trust cannot be terminated or changed under any circumstances. Properly created trusts can maximize the amount of your estate that will flow to your relatives. One of the principal benefits for creating an irrevocable family trust is that your assets are then protected from nursing home expenses or uncovered medical expenses.

Special Needs Trusts

A special need trust can be created to provide for your minor children or incapacitated adult relatives for their care after you are gone and until they are old enough or healthy enough to care for themselves. A parent can name a trustee to be in control of the finances and to decide whether to sell or keep property, and manage assets such as real estate.

IRA Trusts

Trusts work particularly well with Roth IRAs, since there are no required distributions until after the death of the owner. A skilled estate planning attorney knows how to create see-through or conduit trusts that are particularly beneficial for passing assets to grandchildren by naming trusts as beneficiaries of the Roth IRA. If you are looking to set up or learn more about income trusts other than an IRA or would like more information on the IRA trust option, contact one of our qualified attorneys at Lance P. Armstrong, PLLC today.

Staten Island estate planning law help
Contact a Staten Island trusts attorney at The Law Firm of Lance P. Armstrong is an experienced lawyer who handles complex matters of trusts in estate planning and estate and probate matters.

Back To Contents

Article Source: http://EzineArticles.com/?expert=Carl_Gompf

What's the Difference Between a Last Will and a Living Trust?

By Rachel Ergo

Before visiting your estate lawyer, it's a good idea to spend some time learning about the various documents and procedures involved with estate planning.

An essential topic to every estate plan is probate. Probate is a court-supervised procedure for transferring the legal title of your assets after death to your beneficiaries. The probate process involves:

• Proving to the Court that a Will exists and is valid.
• Appointing a legal representative with authority to act on behalf of the estate.
• Identifying and appraising the property of the estate.
• Paying debts and taxes.
• Distributing the remaining property according to the beneficiaries.

Probate proceedings are public records and typically last several months. Any property listed in your name that does not automatically transfer upon your death, is considered probate property. For this reason, a last will goes to probate and a living trust does not.

You may have been told that a trust is more ideal than a will since it can avoid probate. However, there are other details to consider when choosing an estate plan.

Last Will and Testaments
After a will is drawn up, it must go through a formal legal procedure called executing the will. This requires witnesses to the signing of the will. A will is put into effect only upon death, with the provisions controlling all assets subject to probate. Any assigned accounts are not subject to probate and will not be distributed under the terms of a will. Non-probate property such as life insurance, retirement plans, and joint tenancy accounts will pass directly to the named beneficiaries by the institution holding the account.

When it comes to costs, wills are usually cheaper to create, but more expensive down the road when heirs have to manage the estate. A will provides little assistance for asset management while the person is living. If a person becomes physically or mentally incapacitated, the court must appoint a guardian to manage the estate. Even with a good power of attorney, this process is usually burdensome and expensive.

Every state has its own variation of laws that pertain to last wills. When a will is clearly laid out, the accepted rule is that if a will was valid in the state it was made, it remains valid even when moving to a different state. However, if there are any uncertainties or exclusions, the will is usually interpreted by the laws of the state of residency. Thus, other state-specific documents should be created in the new state after each move.

In order to change or add anything in a last will, a codicil must be filed. A codicil is an amendment which must be executed with the same formalities as the original will. Sometimes it is simpler to draw up a new will instead. The original will and any codicils must be presented after death.

While a last will must go through probate, there are simpler types of probate depending on size and type of assets and whether or not there is any contest to the will.

Living Trusts
A living trust is a contract between the creator of the contract and the trustee who agrees to hold assets for the beneficiaries. Each trust has three necessary parties: grantor, trustee, and beneficiary. Typically, one person is all three. The grantor retains all rights to manage the trust while alive and legally competent.

Any terms and conditions can be added, since living trusts are contractual; and because there is much less variation in state trust laws, they can be carried to different states without significant problems. Assets can be added and removed at any time without any tax penalties. As with other contractual arrangements, trusts are not usually required to become public knowledge.

Living trusts are more expensive to create and maintain, but leave fewer burdens on a spouse, children or other heirs later. If the grantor becomes incapacitated, the living trust names a successor trustee to take over and continue to manage the trust. Asset management as a successor trustee is generally much simpler than through the use of a power of attorney.

At the death of the grantor, the terms of the trust define who inherits the trust. The assets can be distributed to the beneficiaries in any manner the grantor chooses. The distribution is private and does not need any court supervision, so the successor trustee can immediately access any accounts held in the trust.

A living trust is designed so that the assets are not a part of the probate process. However, this only works if the provisions are properly put in place during life.

Estate Planning
Both wills and trusts are effective tools to manage an estate during and after life. There are no "one size fits all" plans, so it's important to discuss your options with an estate lawyer.

At Nichols Law, our Houston estate lawyers understand how crucial it is that every element of an estate plan be properly written and well articulated. Contact us for more information.

Back To Contents

Article Source: http://EzineArticles.com/?expert=Rachel_Ergo