Many people who create Trusts do not have a family member who is an appropriate person to appoint to serve as a Trustee. The person who serves as a Trustee should be financially responsible and someone who will not be tempted to administer the Trust for his or her own benefit instead of the benefit of the Trust beneficiaries. Ideally, the person should also be someone who the beneficiaries respect enough to defer to in decision-making without unnecessary challenges.

Many people do have responsible and respected family members who can act as Trustees, but those who don’t have to look for other options. Some people choose to use professionals. Banks and Trust Companies will act as Trustees for a fee. They can both be excellent options. Another option is to hire an attorney to act as a Trustee. Because of the professional ethics demanded of attorneys, they will act for the benefit of the Trust. Yet another option is to appoint the best family member that you can and hire an attorney to act as an advisor to the family member Trustee when the need arises for professional advice.

Talk to your estate planning attorney about who you should appoint to serve as a Trustee for the Trusts that you create and whether you would benefit from a professional as a Trustee.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

People are sometimes confused by the term “Revocable Living Trust.” Unscrupulous companies and websites often take advantage of this confusion as a way to get people to purchase a Revocable Living Trust form from them. These companies and websites make people think that there is something magical about a Revocable Living Trust. However, to understand whether you need a Revocable Living Trust, you need to understand what is truly meant by the term.

The words themselves are not magical and they do not create a magical legal document that is perfect for everyone. First, a Trust is a legal entity that holds property and assets for the benefit of someone or something else. The property is held in “trust.” Revocable and living merely mean that the Trust is created while you are living and that you have the right to revoke the Trust and retain the assets that you put into it. For many people, this is an excellent estate planning method as any assets put into the Trust while you are alive do not have to go through Probate after you pass away. However, some people should use different legal methods in their estate plans, often for tax reasons.

To know whether a Revocable Living Trust is right for you, talk to an experienced estate planning attorney.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

One thing that makes estate planning fun is that everyone’s situation is unique. Every client that comes into an estate planning attorney’s office has a different story to tell and different estate planning goals. The fun part for attorneys is not only in listening to all of the different stories, but also in developing an estate plan that meets each client’s unique situation.

For example, many people go to an estate planning attorney with the idea that they need to get a Living Trust. Most people will actually end up with an estate plan that does include a Trust. The questions become what kind of trust? How is it structured? Is it revocable or irrevocable? Does it include a Trust Protector? Can it be amended? Who will serve as the Trustee? The answers to these questions and others like them make each Trust a little different. The estate planning attorney finds those answers by listening to what the clients say.

In today’s world, you do not have to go to an estate planning attorney to get a Living Trust. There are other options. However, you should go to an attorney so that you can be certain that someone has listened to your story and created a Trust that is right for you.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

People who create their own estate plans often make the mistake of thinking that they only need to use one legal instrument and that it will take care of everything. This is usually a Revocable Living Trust. While a Living Trust is a great estate planning tool, it is probably not the only thing you need. Estate planning is more like putting a puzzle together to find the right fit between various legal instruments to effectuate your goals.

A Revocable Living Trust is only effective for the property that you transfer to the Trust. If you forget to transfer something or are unable to transfer something for some reason, than the Trust has no legal authority over that property. If you pass away before you can transfer everything into the Trust, the Trust will also not be effective. The normal solution for this problem is to execute a Pour Over Will. This is a very simple Will that directs that any property in your estate should be transfered to the Trust. That allows the property you didn’t transfer to be distributed according to the terms of the Trust.

There might be other estate planning instruments that you want to use with your Revocable Living Trust. Each person’s estate planning puzzle is different. An attorney can help you solve your puzzle.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

A question that often comes up in estate planning is “How much money do you need to get a Trust?” The question is a fundamental misunderstanding, but a common one. Although there would not be much point in doing so, you can put as little as a single penny into a Trust.

The question is based on the premise that Trusts are designed for rich people. It’s a false premise. Trusts are designed for anyone who either wants to give something for one person to manage for the benefit of someone else or who wants to have their estate avoid Probate. Imagine that you have a minor niece that you want to leave a thousand dollars to. That’s a lot of money for most children and they can be expected to want to blow it as soon as possible. Instead of giving it to your niece directly, you can put it into a Trust. It can earn interest and be made available to your niece when she comes of age.

Trusts are also a great way for everyone to avoid having their estate pass through Probate. If you put all of your assets into the Trust, those assets will be divided according to the terms of the Trust without court intervention. It does not matter how much you have. If you have something, you can use a Trust.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

After you set up a Revocable Living Trust, one of the first things that you do is to transfer your other assets into the Trust. Most people will try to make sure that everything they have when they pass away will transfer through the Trust to the beneficiaries. However, it is not always a good idea to do that. It depends what you are trying to transfer through the Trust.

For example, if you have an IRA, you can name the Trust as a the beneficiary. By doing that, the money in the IRA will be handled according to the terms of the Trust. However, if you name a person as your IRA beneficiary, then that person can keep the IRA open and continue to take advantage of the tax benefits. A Trust cannot do that as an IRA requires the owner to be a person with a life expectancy in order to take advantage of the tax benefits.

Most assets should be transferred into a Revocable Living Trust. Exercise caution, however, and make sure that you are not losing other important benefits with some instruments. Ask you estate planning attorney if you have questions about your Revocable Living Trust and transferring your assets into it.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

In the last post you learned that probate does not have to be scary if you have an experienced estate planning attorney assist you in making your estate plan. However, that does not mean that your heirs will necessarily have to go through probate if you hire an attorney. In some cases, a revocable living trust is a good option for an estate plan. Property that passes to your heirs through a revocable living trust does not have to go through the probate process.

A living trust is not necessarily a special type of trust. “Living” merely refers to any trust created during the grantor’s life as opposed to a testamentary trust that is created in a will. Living trusts can be revocable, which means that the grantor can dissolve the trust during his or her life.

You can put many different types of assets into a revocable living trust and have them pass to your heirs upon your death. However, you need to make sure that you set up the trust properly. The way the trust is designed can have tax consequences for you and your heirs. Different trust arrangements are better or worse in different circumstances. A trust attorney can help you to determine what the best type of revocable living trust is for both you and your heirs.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

To fund your living trust, you need to transfer assets into your trust. You can transfer money and property into your trust by placing title to your bank account and title to your real property into the trust. You must specifically identify the property and accounts within your trust.

In addition to properly funding your living trust, you need to appoint an individual or trust company to oversee and administer your living trust. The New York Estates, Powers and Trusts Law governs the administrative duties of trustees. Specifically, Article 7 of the New York Estates, Powers and Trusts Law sets forth the specific rules governing trusts. Part 2 of Article 7 establishes the specific duties and rules governing trustees.

Although there may be public confusion whether living trusts are contestable, they are. An attorney can minimize the opportunities for trust contests, but it is impossible and illegal to place a blanket provision in your trust prohibiting future contests. You should avoid sales pitches by trust companies attempting to sell you their trust services if they falsely promise to make them “fool-proof.” If you purchased a service from these companies, make sure you talk to your attorney about the living trust document they sold you before returning them.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

There are many different reasons you may want to create a living trust, and your attorney may decide to supplement your will with a living trust. However, in most cases, a living trust does not replace the need for a will. Your attorney may decide that creating a living trust is essential to your overall estate planning needs.

A living trust does not have to go through probate, and your living trust is not a part of public record, as your will is. A living trust may be a good idea to help you address setting aside enough money for a child or incapacitated adult who is unable to take care of her own finances. You can give your trustee specific instructions for distributing money to a guardian to address those special concerns.

Your attorney may decide that a living trust is unnecessary to meet your estate planning goals because other instruments, such as payable on death accounts, may address them. After discussing your needs with your estate planning attorney, your attorney can discuss the benefits with you. You can contact our office today to discuss whether a living trust is appropriate for your individual estate planning needs. If you contact our office we can help you determine the costs and benefits of creating a living trust as part of your estate planning documents.

Check in with us tomorrow to read Part 3 of An Insider’s Guide to Living Trusts in New York.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.

A living trust allows the person creating the trust to set aside money or property within the trust for the benefit of others by appointing a trustee to administer the trust and ensure the trust property is distributed to the beneficiaries. If you are the person creating a living trust, you are known as the grantor, owner or settlor of the living trust. A living trust is also known as a revocable inter vivos trust.

A testamentary trust, on the other hand, becomes operative after your death, pursuant to your will. Testamentary trusts typically go through probate. A living trust earns its name from the fact that you as the grantor of the trust created it while you were alive and it becomes effective before your death. After your death, your living trust may continue to operate as long as you comply with the New York Estates, Trusts and Powers Law when creating one.

Your attorney may also decide to create a “pour-over” will that allows any other property to pour-over into your trust after your death. However, the property that may pour-over from your will into your living trust will still have to go through probate. It typically becomes public record as soon as your personal representative or trustee submits it for probate. In this case, your living trust and your will become part of the New York Surrogate Court’s public records accessible by public request.

Check in with us tomorrow to read Part 2 of An Insider’s Guide to Living Trusts in New York.

Davidov Law Group is a member of the American Academy of Estate Planning Attorneys.