Many people choose to set up a trust when they are creating an estate plan. This allows them to protect their wealth from taxes when passing them onto a beneficiary, thus maximizing their worth. This is done by appointing a third-party trustee to manage the assets on behalf of a beneficiary. There are many different trusts that can be created based on what the trustor wants to accomplish, such as a revocable trust. Continue reading and reach out to a skilled New York estate planning attorney to learn more.

What is a Revocable Trust?

When a person creates a revocable trust, they can modify, change, or terminate it at any time throughout their life. This can be done as long as they are mentally capable of doing so, without the permission of the beneficiary. These benefits make revocable trusts a common choice for individuals.

How Do I Fund a Revocable Trust?

A revocable trust can either be funded during a person’s lifetime or at their death. How this is done can vary depending on the assets that are being put in the trust. This can include:

  • Residences or other real estates. Trustors are required to execute a deed in order to transfer real estate into a revocable trust. They should ensure all necessary steps are taken so that they can receive property tax exemptions or valuations.
  • Marketable securities and cash that are not in tax-deferred savings. This requires trustors to open accounts in the name of the trust. Then, a bank or brokerage can transfer the assets from the individual account to the trust’s account.
  • Interests in closely held business entities. These assets can often have restrictions on transfers. This can include limits on types of transfers, requiring the consent of other parties before transferring, or requiring the consent of other parties before a transferee receives full ownership rights. It is because of this that it is important to have the help of an attorney.
  • Life insurance policies. In most cases, trustors who want the ownership of their life insurance policy to their trust should only need to change the beneficiary designation on the policy. To do so, trustors must obtain a form from the life insurance company.
  • Tangible personal property. These assets can include jewelry, furniture, artwork, books, clothing, electronics, etc. As they usually do not have ownership documents, transfers can be through a general transfer and assignment document. 

Contact our Firm

The Lauterbach Law Firm is proud to serve clients throughout Rockland County who are faced with legal matters related to estate planning, real estate, foreclosure defense, landlord-tenant law, business law, and criminal defense. If you require the services of an experienced team of attorneys, contact The Lauterbach Law Firm today to schedule a consultation.