Legal Specs

Your Living Trust Might Go Through Probate!

26 Aug 2008

One of the great things about having a revocable living trust is that you know your estate will not fall into probate after your death. But, even if you have a trust, there is still a risk that your trust will fall into probate after your death. Why? One of the main reasons for this is not keeping all of your assets properly titled in the trust's name. Usually, I see this happen when clients have not been educated in what they need to do to keep their living trusts up to date. Here is what you need to know and do to prevent this from happening to you.

Holding Assets in Trust

When you set up the trust, you transferred your assets so that they'll be held in your name, as trustee. There will be a new deed showing that your home is titled in the trust's name with you acting as trustee. This keeps your home out of probate and allows you the same rights to the home as you had before the house was transferred to the trust. In other words, you maintain control during your lifetime.

Items that need to be transferred to trust include:

• Your Residence
• Other Real Estate
• Checking and Savings Accounts
• Certificates of Deposit
• Investments
• Businesses
• IRA's
• Annuities
• Stocks / Bonds
• Pensions
• Notes Receivable
• Insurance Plans

How do you know that this is the case? If your assets are in the name of your trust, this will show up on the statements that you receive. For example, your bank statements will be labeled as the John Doe Trust, with you listed as the trustee. This means that you retain the control during your lifetime, and upon your death control reverts to the trust. Neglecting to label new assets in this way can send your estate to probate.

Every time you gain an asset, you have to remember to title the asset in the name of the trust, which will keep your assets from being subject to probate after your death. Educating trust owners on the necessary steps to keeping their trusts up to date is a critical function of an estate planning attorney. Ultimately, however, it is your diligence that will make it happen.

Choose your estate planning attorney carefully, and don't hesitate to ask questions regarding your living trust and new accounts. Planning carefully now will protect your heirs and assets when you're no longer around to do so.

About the Author:

Discover the Secrets of Wealth Preservation as expert estate planning attorney, Steven W. Allen, reveals the proven estate protecting strategies that have been used by the wealthy for centuries. Visit www.LivingTrustDr.com now for more tips and tools to protect your estate from taxes and probate.