A revocable trust, or living trust, in Florida saves both time and money by avoiding probate. Probate is the legal procedure by which assets are distributed to beneficiaries or heirs at the time of one’s death – but not before all debts, taxes and other claims are paid. The process can be expensive, and require considerable inconvenience during an emotionally difficult period.
Put simply, a revocable trust is a legal document that directs the distribution of assets placed in it upon one’s death. Unlike a last will and testament, which takes effect only after you die, a revocable trust can be managed during one’s lifetime. It can also generate income, and side-step court intervention in favor of a handpicked trustee should you become ill or unable to manage your affairs.
A standard will must go through probate. In fact, a person’s assets must pass through probate even without a will. Courts makes sure creditors are paid. A revocable trust involves transferring actual ownership of the assets you place in it the trust through which a selected “successor trustee” is authorized to act and carry out pre-determined directions. Since ownership is transferred, there’s no property at the time of death to go through probate proceedings.
This can save you money. A probate court will appoint someone to take control of the deceased person’s assets. With a will, it’s usually the named executor. But in many cases, the executor will need to hire a probate attorney to assist in the administration of assets.
This can include opening a financial account for the estate, determining and paying creditor claims – including funeral costs and any unpaid medical bills – court fees, accountant fees, attorney fees, a final federal tax return, and only then, the distribution of remaining estate assets, which might still require costs associated with the sale of real property and capital gains tax.
Avoiding probate, however, is just one way a trust can help you as a Florida senior. There are many different types of trusts, and a revocable trust is just one example. There are also irrevocable trusts that can offer significant solutions for seniors who are risk for one day needing to pay for the high cost of long-term care. The key with any type of trust planning is to work with an attorney who understands the intricacies of elder law focused trust planning and can assist you with the planning you need.
Planning for long-term care as well as probate both take time; often a series of months. However, trust-based planning affords immediate attention for timely matters, such as time qualification, sensitive financial information and your needs. Do not wait to talk to a member of our legal team about the type of legal planning you need to protect your future.