Davis: Living trust - Fact and fiction
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Living trusts can be powerful estate planning tools which, if utilized properly, can help many people. They provide certain estate administration advantages that are not available through other estate planning devices. Living trusts are more accurately referred to as “revocable inter vivos” trusts. If a trust is “revocable,” the person who establishes the trust can change all or any part of the trust, so long as that person is competent. “Inter vivos” is the Latin term for “during life.” Assets owned by living trusts generally are not included as part of the probate process at death. Probate generally refers to the court process by which a deceased person’s assets are gathered and distributed to his or her beneficiaries. If you are considering establishing a living trust, it might be helpful to sort through some of the fact and fiction relating to such trusts. Fact or fiction: Avoiding probate is always desirable? In a strict sense, this is fiction. Probate can be an expensive and time consuming process. However, there are some situations in which a probate proceeding may be desirable. In certain circumstances, the Court supervision of the estate administration may be advantageous. Fact or fiction: Living trusts always save money during administration of the estate? By avoiding the probate court, living trusts will likely save on attorney fees and court costs associated with the probate process. However, the living trust will not avoid all costs at the time of death, as there may still be income and estate tax returns to file and legal, administrative and asset transfer work to do. More : dodgeglobe.com |