When an estate reaches the time when it must pass from owner to heirs, or beneficiaries, it generally goes through a legal process known as probate. Most estates, even those with a will are required to pass through probate. However, a Florida living trust (or a revocable trust) does not need to go through probate to distribute assets to the trust’s beneficiaries.
What is a Will?
A will is a legal document describing how you would like your assets and property to be distributed upon your passing. It does not go into effect until you have passed away. If you pass away in the state of Florida without a will, the distribution of your assets will be determined by Florida Statute. To ensure your property is passed down in a manner you see fit, having proper estate planning is vital.
What is a Revocable Living Trust?
In a living trust, ownership of property is transferred from one person (the settlor or grantor) to a “trustee.” The trustee uses and manages the assets on behalf of the trust’s beneficiaries. The settlor and trustee can be and often are the same person. You can place your assets into a trust and use them during your lifetime. Upon your passing, they can then be distributed to the beneficiaries you name in your trust.
It is important to note that there are some things you may not be able to include in a trust, so be sure to speak with your estate planning attorney.
Creating a Living Trust in Florida
First, let’s make the distinction between a revocable living trust and an irrevocable trust. The terms of a revocable trust can be modified if you have a change of heart (or mind) down the road whereas an irrevocable trust cannot be changed.
Online tutorials or free downloads may not provide adequate language to properly set up a trust in a manner that best suits your needs.
Benefits of a Living Trust
- One of the prominent reasons many people elect to establish a trust is to avoid having their estate go through probate. Since a revocable living trust does not go through probate, a process that could take months, the assets can be transferred immediately to the named beneficiaries—or at a time you specify. Wills must go through probate and once they finally do, the assets and property ownership are then transferred to the beneficiary.
- Specifying a distribution date is also another reason people establish a trust. This provision makes it easier to plan for the future of a minor or special needs adult child.
- Another benefit of a living trust is to maintain privacy of your estate. Probate is public, including details of a will. Bypassing probate with a trust keeps your assets, beneficiaries, and the terms of your trust private.
Wills vs Trusts
Wills are perhaps the most well-known element of estate planning. A will is a legal document that outlines how you would like your assets to be distributed after your death. You can also use a will to appoint a guardian for minor children and pets. Wills must be signed by the testator (the person writing the will) and witnessed by two adults.
Trusts are another important element of estate planning. A trust is a legal arrangement in which one person (the trustee) holds property for the benefit of another person (the beneficiary). Trusts can be used for a variety of purposes, such as avoiding probate, minimizing taxes, and protecting assets from creditors.
An attorney qualified and experienced in wills and trusts can help you appropriately plan your estate and wisely protect your interests. Contact Myrthil’s Law to have a revocable living trust created for your assets or discuss all of your estate planning needs.