More and more individuals are putting their assets into revocable living trusts
which are completely flexible and broadly adaptable arrangements for management,
protection and distribution of a family's assets.
A living trust is created during your lifetime and is funded with most or all of
your assets by simply re-titling the assets to yourself as trustee.
A living trust is LIVING in that it takes effect immediately. You continue to enjoy
all the present benefits of your assets. A living trust is revocable during your
lifetime, which means that its terms are changeable and assets in the trust can
be retransferred to your name if desired, without adverse tax consequences.
A living trust is a private agreement where the distribution of assets under the
terms of the trust is not subject to the publicity given to wills in probate proceedings.
The complete flexibility of a revocable living trust means that one can be drafted
to suit your individual needs and family situation.
When you create a living trust, you can act as your own trustee so there are no
management fees or loss of control. You can change or modify the trust terms at
any time, change beneficiaries, and add or delete assets held by the trust without
tax consequences.
A revocable living trust does not complicate the management of your assets. While
protecting your property within a living trust you can do whatever you can do now
with your assets and property. You can buy, sell, borrow, make gifts, etc.
With a living trust you retain control over all your property and assets during
your lifetime and you determine distribution of your estate after your death. Since
a living trust is revocable, it has no income tax consequences during your lifetime;
no separate tax return is even filed and all trust income is reported under your
social security number.
With a Living Trust, you are also appointing someone else (a professional, a trusted
friend or a family member) to manage the assets in your trust for your benefit
in the event of your incapacity (e.g., Alzheimer's, a stroke, an accident, etc.);
because the assets are in a trust, no court administered conservatorship should
be required. Under a living trust, you have the successor trustee of your choice
ready to step in and take over your affairs until you recover or for the remainder
of your lifetime.
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