Generate A Revocable Living Trust with LegalZone

Generate A Revocable Living Trust with LegalZone

What Is a Revocable Living Trust?

Also known as a Living Trust, a Grantor Trust, or Inter-Vivos Trust, a Revocable Living Trust is a document that designates who will receive your property upon your death.

Since this document is labeled as “Revocable,” you can make amendments or revoke the Trust at any time. Or you can make additions to the Trust as needed. For example, if you become a grandparent, you may decide you want to add your grandchild to the Trust along with your children.

A revocable Living Trust is a commonly used estate planning tool that can avoid probate and estate taxes.


Who Are the Parties in a Living Trust?

A Revocable Living Trust needs a Grantor or Trustor and a Trustee. Often, the role of Trustor and Trustee is taken on by the same person: the individual who creates the Trust. The Grantor is specifically the person who creates and funds the Trust, and the Trustee is the person who manages the Trust’s assets.

In cases where the Grantor and Trustee are not the same people, the Trustee has control over the Trust even while the Grantor is alive.

Sometimes married couples will develop a Trust together, and in these instances, they assume the roles of Co-Grantors or Co-Trustees. When one member of the partnership passes, the other assumes full responsibility for the Trust.

Additionally, some choose to name a Successor Trustee to retain control of the Trust if the primary Trustee passes away or becomes incapacitated.


What Types of Property Can Go into a Living Trust?

Property with high financial value can be included in a Trust to protect it until it can be transferred to the beneficiaries. Examples of Trust-eligible properties include:

  • Real Estate – commercial, residential
  • Securities – stock, bonds, mutual funds
  • Business Interests – company shares, partnership interests
  • Financial Assets – bank accounts, cash, notes payable
  • Valuable Personal Property – jewelry, artwork, antiques, etc.

Assets that need to be insured, like cars, are not included in Trusts.


How Do I Make a Living Trust?

The first step in crafting a Living Trust is to list your property and associated beneficiaries in a Revocable Living Trust Document. You’ll appoint a Trustee and transfer your assets into the Trust by naming the Trustee as the owner.

For instance, if you’ve appointed someone else as your Trustee, you’ll need to use a Quitclaim Deed  or a Warranty Deed to transfer real estate into their name.


What Is the Purpose of a Revocable Living Trust?

Individuals or couples with various assets often use Revocable Living Trusts to plan how to distribute the property clearly. A Trust avoids the probate process, allowing the assets to be given to the beneficiaries more efficiently.

Compared with a Last Will and Testament, a Trust is a more detailed legal document that allows individuals to be more specific about distribution. It’s also easier for a Trustee or Successor Trustee to take control of the Trust. However, in some cases, a Pour-Over Will is necessary to designate beneficiaries of property acquired after the Trust was created.


What Are the Disadvantages of a Revocable Living Trust?

You can’t put children into a Trust; that is to say that you can’t appoint guardians for minors in a Trust like you can in a Will. Trusts also prevent you from naming an executor and instructing how debts or taxes should be paid.


Creating A Revocable Living Trust with LegalZone

At LegalZone, we make it easy and affordable for people to get the legal documents they need. If you have more questions about whether a Revocable Living Trust is right for you, reach out to one of LegalZone customer support specialists.


If you’re ready to get started with your document, click here.