When you pass away, a revocable trust can keep the assets it owns out of probate. If you lose your capacity to administer the trust, you might choose a successor trustee to handle it on your behalf. You should note, however, that since you maintain legal ownership of the assets maintained in a revocable trust, they are not shielded from creditors, litigation, or estate taxes. This is how an irrevocable trust differs from a revocable trust. This area of law is best navigated by a skilled California estate planning attorney with experience in trusts and trust administration, much like the ones at Meier Law Firm.
You may want to take this course of action for a few reasons. For one, you can avoid the drawn-out, painful, and expensive probate court process so that your family can inherit the family house. Instead, soon after they pass away, their residence might be quietly transferred to their heirs. Additionally, you can put this plan in place if you become incapacitated. You will designate a replacement trustee when you establish a living trust. When you pass away, they are in charge of transferring your assets to your heirs. And if you become incompetent and unable to speak, they are also accountable for intervening and taking over the management of the assets in your trust.
You may come across some terms in your research or consultation with our firm. You can familiarize yourself with them here. When establishing a living trust, you are referred to as the settlor or grantor. When you create the living trust, you also name yourself the trustee. The trustee is the individual with authority to oversee all of the funds, assets, and possessions that are included in the living trust. While you are still alive, you can continue administering all the assets in your trust as you already do by appointing yourself the trustee. For instance, even if you want to place your real property into a trust, you can still sell it in the future.
In a revocable living trust, you will designate your beneficiaries. Your beneficiaries are the people you want to receive any money and personal property you own upon your passing. This often refers to a spouse, kids, grandkids, etc. Don’t forget to choose your successor trustee. After your death or incapacitation, your successor trustee will be in charge of overseeing your living trust. They’ll handle your estate’s settlement and disperse your assets to your beneficiaries once you pass away. Additionally, if you put your home into a trust, the successor trustee will be in charge of managing your property and any other assets you named in the trust in the event of your incapacity.
So once your trust is created, you must transfer real estate to your trust so that it doesn’t accidentally end up in probate, which was the whole point of setting up a trust. The first step is to order a copy of your existing deed. You need to find out how you currently hold the title and confirm that nobody else has legal rights to the property. You’re going to prepare a new deed, and you’re going to identify the current owner and who the new owner is. So, in this case, the new owner would be your trust. Then you’re going to sign that deed in front of a notary and file it with the local county recorder’s office where the property is located.
There are also likely going to be some other forms you need to complete for efficient deed transfer, such as the preliminary change of ownership deed form, and there will also be fees that will need to be paid. Now, most people do need help with this process. There are a lot of steps in that you don’t want to do it incorrectly and then inadvertently find out that your property has been reassessed or that a deed has been rejected. We encourage you to reach out to your estate planning attorney, who helps you set up the trust, or a title insurance company who may assist you.
It is not recommended that you do this process alone. Transferring real property into a living trust can be a nightmare – one mistake and your entire estate could be in jeopardy. Let us help you get it right the first time! You should schedule a consultation with a California estate planning attorney at Meier Law Firm to disclose the specifics of your proposed trust. We can flesh out an estate plan that is right for you!