Revocable Living Trusts

A Revocable Living Trust is a type of trust that offers flexibility by allowing changes to its terms during your lifetime. However, upon your death, the trust becomes irrevocable, meaning its terms cannot be altered.

A Revocable Living Trust enables you to maintain ownership and control of your assets. When you place assets in the trust, they are legally titled to the trust. For example, if you transfer your real property to the trust, you will record a deed from yourself to yourself as trustee of the Trust. As the initial trustee you have full control over the Trust assets during your lifetime, unless you become incapacitated, in which case a successor trustee will assume control over the Trust assets.

Upon your passing, a successor Trustee appointed by you will assume responsibility for paying taxes and resolving any claims, and will then manage the Trust assets in accordance with the terms of the Trust.

The Advantages Of A Living Trust

There are many benefits of establishing a revocable trust in Florida, such as:

Avoiding probate: By transferring assets to a living trust, your successor Trustee will be able to transfer your assets to the beneficiaries named in the Trust without the need for probate.

Guardianship avoidance for incapacity: With a living trust, you can prevent the court from appointing someone to manage your finances if you become incapacitated. Instead, a designated successor trustee will administer trust assets according to your instructions. This can occur without invoking the jurisdiction of the court, ordinarily with the opinion of your medical doctor that you lack capacity. You can also resign as Trustee for any reason, and allow your successor Trustee to assume control over the Trust assets.

Guardianship avoidance for minor beneficiaries: Under Florida law, a minor’s parents cannot manage a minor’s inheritance, personal injury award, or other property interest in excess of $15,000.00. In the absence of a Trust, a guardian must be appointed to manage any such asset. Use of a living trust can eliminate this requirement for gifts to your minor child(ren). Any such gift you make to your child(ren) will be held in trust for them by the successor

Trustee until your child reaches the age of majority or a later age you specify in the Trust. This is another advantage of a Trust versus a minor’s guardianship, which can only last until age eighteen. Many if not most of our clients prefer that gifts to their young adult children NOT vest automatically at age eighteen.

Asset protection for beneficiaries: A properly created living trust offers asset protection for beneficiaries. At the time of your passing, the trust becomes irrevocable, and creditors cannot force immediate distributions.

Post-death asset control: A living trust provides flexibility in asset distribution. You can choose to have trust assets distributed immediately to beneficiaries upon your death or have the successor trustee make periodic distributions of income or assets based on the trust provisions.

Protecting beneficiaries with special needs or government benefits: Inheritances received by individuals with special needs or those receiving government benefits, such as Medicaid, can affect their eligibility for such programs. By creating a special needs trust for particular beneficiaries with special needs as part of your Revocable Living Trust, you can supplement government benefits and ensure long-term care and an improved quality of life for the beneficiary, without affecting their eligibility for benefits.

The Difference Between A Will And A Revocable Living Trust

A will is a document that expresses your testamentary intent, such as designating beneficiaries for your assets, naming your personal representative, providing for disposition of your bodily remains, and appointing pre-need guardians for your minor children. Wills are subject to probate, unlike living trusts, which facilitate asset distribution without court supervision.

A Revocable Trust is a Will substitute. All of the terms you would ordinarily place in your Will are placed in your Trust instead. A Will is almost always signed on the same day as the trust in case the Trust is revoked prior to the death of the principal, or in case the principal fails to transfer all of their assets to the Trust during their lifetime. Your beneficiaries may find it advantageous to introduce the Will to probate in order to take advantage of the ability to defeat creditors’ claims in probate court.

A living trust is one method of avoiding the probate process. Other asset management techniques, such as use of an Enhanced Life Estate Deed (“Lady Bird Deed”, joint tenancies with right of survivorship, beneficiary designations on life insurance policies and other investment accounts, are equally effective. We will explore all of these options with you during your initial consultation in order to develop an estate plan that most effectively meets your goals.

The terms of your Will become part of the public record. The terms of your living trust remain private, although your successor trustee will be required to file a notice of trust with the court in order to give notice of the existence of the trust.

You can name a pre-need guardian for your minor children in either a Will or Revocable Trust.

Both Wills and Trusts can be challenged in court by any interested party.

Contact Raymond S. Grimm Esq.P.A. For Experienced Living Trust Creation

Contact Raymond Grimm for an initial consultation to discuss whether a revocable living trust will accomplish your estate planning goals at (941) 423-7897 or complete our online contact form for a complimentary consultation.