As the grantor of a living trust, you may establish a trust document that sets terms and conditions for how it should be administered and distributed at the time of your unfortunate passing. However, this document may mean nothing if the trust is not properly funded in the first place. With that being said, please continue reading to learn what is involved in funding a living trust and how an experienced New York City trusts attorney at Zimmet Law Group, P.C. can work to ensure everything goes to plan.
What is funding a living trust?
Essentially, funding a living trust means transferring your ownership rights over certain assets to the trust itself after it has been created. But even though your living trust would now technically own these assets, you may still maintain full control over them throughout the rest of your lifetime. That is if you opted for a revocable living trust. As for an irrevocable living trust, though, the authority to manage these assets goes to your designated trustee.
Now, you must be strategic with which assets you choose to undergo a transfer of ownership. It may not be worth surrendering ownership rights over all your assets, especially if you establish an irrevocable living trust. What’s more, some assets may entail a more complex transfer process than others. Some may even need a legal representative’s aid (i.e., for real estate property). This is all to say it may be worth getting your priorities straight before you dive in.
How do I place my assets in a living trust?
There is a particular procedure for transferring your ownership rights to the living trust. This procedure goes far beyond simply naming your assets in the trust document. Rather, it entails changing the title of ownership from your name to the name of your designated trustee. Then, it involves changing the beneficiary designation from your beneficiary’s name to the name of the trust itself.
If you do not take the steps to change the titles and beneficiary designations for your assets, your living trust may be considered to be unfunded. In this case, your assets may be subject to the New York State Surrogate Court’s probate process. Here, your assets may be distributed according to the state’s intestacy laws rather than your set list of instructions within the trust document. Undergoing this process may also mean your assets are subject to certain estate taxes.
Ultimately, this may be the exact opposite of your intended goal. For this reason, we strongly encourage you to retain the services of a skilled New York City estate planning attorney. You may do so by scheduling an initial consultation with the Zimmet Law Group, P.C. today.
