Can a living trust protect my assets from being used to pay for catastrophic medical costs?
No. Including a catastrophic illness clause in your living trust won't shield your property. If you have concerns about this, you should talk to an attorney.
Does a living trust avoid estate taxes?
A living trust can help avoid estate taxes. The federal estate tax generally applies when a person’s assets exceed $11.58 million in 2020 at the time of death. California does not impose an estate tax.
Do I need an attorney to form a living trust?
No. You don't need an attorney to form a living trust. You can prepare the legal paperwork and file it yourself, or use an online legal document service like Living Trust Express. However, if you have questions you can't resolve on your own, if your estate will face a significant tax burden, or if you think your spouse or children will challenge your trust, you should consult with a licensed attorney.
Can I make a loan from my trust to a beneficiary?
Yes, if your trust documents state explicitly that this is allowed. If it is permitted, you can make the loan, which the beneficiary must pay back with interest. You can allow the beneficiary to repay the loan with money he or she would otherwise have received from the trust.
Similarly, you can make it clear in the trust that the trustee can make payments on behalf of a beneficiary (e.g., a child's college tuition).
Do I still need a will if I set up a living trust?
Yes. A will deals with any property that was not included in the living trust. This property may have been left out for any number of reasons. For example, property that wasn't properly transferred into the trust will be distributed under your will. Property you bought or received after the trust was created will be distributed according to your will, unless you transfer the property to, or purchase it in the name of, the trust.
A will also lets you name a guardian for your minor children and covers property intentionally left out of the trust (e.g., cars, personal checking accounts). A Living Trust Express “Living Trust” includes a simple pour-over will for this purpose.
Can I include property in my trust if I still owe money on it?
Yes. The most common example of such property is a house with an attached mortgage. Your beneficiary becomes responsible for the debt (i.e., the mortgage) when he or she receives the property. If you want your trust to pay the balance of a mortgage or other debt on an asset before that property is distributed to a beneficiary, you should talk with an attorney.
Do I need to set up separate record keeping for the living trust?
No. If you are the initial trustee of your trust, you do not need to set up separate records from the personal financial records you currently maintain.
Can I transfer property in and out of the trust while I am alive?
Yes. If you have an individual trust, you can transfer property in and out of it whenever you want - you don't need anyone else's permission. If you have a shared trust, you may need to get your co-trustee's consent if you're transferring property you own together.
What is a living trust?
A trust is an arrangement in which one or more people manage or take care of property for someone else's benefit. A living trust is a trust that is created during your lifetime. In other words, while you are still alive, you transfer title to your property from your name to that of the trustee of the living trust. You can use the trust to gather your property under one document so that it is distributed efficiently after your death.
When you put your property into a trust, the trustee of that trust owns the property - you are no longer the legal owner of the transferred property. This doesn't mean you have no control of your assets. Since you will probably be your trust's initial trustee, you will still be in charge of your property. You can do whatever you want with it - you can leave it alone, take it out of the trust, or use it as you had been before the trust was created. A living trust is an easy way to organize your assets and manage them as a single unit. Most importantly, a living trust allows for a timely and efficient property distribution when you die.
I have an existing trust, can I make changes to it?
Yes. In most cases, Living Trust Express can assist with making simple changes like updating your successor trustee(s) or making changes gift and beneficiary designations. We can also assist in making a complete Amendment and Restatement of your existing trust document which is a simple way to have your current wishes entirely supersede your original decisions.
When should you update a living trust?
You should consider amending your living trust if, for example,:
You get married or divorced
You have, or adopt, a child
You move to another state
Your financial status changes significantly
One of your trust beneficiaries dies
One of your named trustees dies or is incapacitated
No. Including a catastrophic illness clause in your living trust won't shield your property. If you have concerns about this, you should talk to an attorney.
Does a living trust avoid estate taxes?
A living trust can help avoid estate taxes. The federal estate tax generally applies when a person’s assets exceed $11.58 million in 2020 at the time of death. California does not impose an estate tax.
Do I need an attorney to form a living trust?
No. You don't need an attorney to form a living trust. You can prepare the legal paperwork and file it yourself, or use an online legal document service like Living Trust Express. However, if you have questions you can't resolve on your own, if your estate will face a significant tax burden, or if you think your spouse or children will challenge your trust, you should consult with a licensed attorney.
Can I make a loan from my trust to a beneficiary?
Yes, if your trust documents state explicitly that this is allowed. If it is permitted, you can make the loan, which the beneficiary must pay back with interest. You can allow the beneficiary to repay the loan with money he or she would otherwise have received from the trust.
Similarly, you can make it clear in the trust that the trustee can make payments on behalf of a beneficiary (e.g., a child's college tuition).
Do I still need a will if I set up a living trust?
Yes. A will deals with any property that was not included in the living trust. This property may have been left out for any number of reasons. For example, property that wasn't properly transferred into the trust will be distributed under your will. Property you bought or received after the trust was created will be distributed according to your will, unless you transfer the property to, or purchase it in the name of, the trust.
A will also lets you name a guardian for your minor children and covers property intentionally left out of the trust (e.g., cars, personal checking accounts). A Living Trust Express “Living Trust” includes a simple pour-over will for this purpose.
Can I include property in my trust if I still owe money on it?
Yes. The most common example of such property is a house with an attached mortgage. Your beneficiary becomes responsible for the debt (i.e., the mortgage) when he or she receives the property. If you want your trust to pay the balance of a mortgage or other debt on an asset before that property is distributed to a beneficiary, you should talk with an attorney.
Do I need to set up separate record keeping for the living trust?
No. If you are the initial trustee of your trust, you do not need to set up separate records from the personal financial records you currently maintain.
Can I transfer property in and out of the trust while I am alive?
Yes. If you have an individual trust, you can transfer property in and out of it whenever you want - you don't need anyone else's permission. If you have a shared trust, you may need to get your co-trustee's consent if you're transferring property you own together.
What is a living trust?
A trust is an arrangement in which one or more people manage or take care of property for someone else's benefit. A living trust is a trust that is created during your lifetime. In other words, while you are still alive, you transfer title to your property from your name to that of the trustee of the living trust. You can use the trust to gather your property under one document so that it is distributed efficiently after your death.
When you put your property into a trust, the trustee of that trust owns the property - you are no longer the legal owner of the transferred property. This doesn't mean you have no control of your assets. Since you will probably be your trust's initial trustee, you will still be in charge of your property. You can do whatever you want with it - you can leave it alone, take it out of the trust, or use it as you had been before the trust was created. A living trust is an easy way to organize your assets and manage them as a single unit. Most importantly, a living trust allows for a timely and efficient property distribution when you die.
I have an existing trust, can I make changes to it?
Yes. In most cases, Living Trust Express can assist with making simple changes like updating your successor trustee(s) or making changes gift and beneficiary designations. We can also assist in making a complete Amendment and Restatement of your existing trust document which is a simple way to have your current wishes entirely supersede your original decisions.
When should you update a living trust?
You should consider amending your living trust if, for example,:
You get married or divorced
You have, or adopt, a child
You move to another state
Your financial status changes significantly
One of your trust beneficiaries dies
One of your named trustees dies or is incapacitated