A trust is an arrangement in which one person (the trustee) manages and holds the title to a property, which can be both personal property and real property, to another (the settler or with) in favor of a third party (the beneficiary).
There are many types of trusts in Florida. A testamentary trust is created by the will of a person and takes effect after his death. One of the reasons why a person may want to create a testamentary trust is it allows him to control how the assets are given to the beneficiary.
There are other types of trusts in Florida that can be beneficial to your situation, such as Irrevocable Life Insurance Trusts, Contingent Minors Trusts, and more.
Revocable Living Trusts
A revocable living trust is an artificial entity used as an estate-planning tool that manages your assets during your lifetime and distributes them upon your death. It is called a revocable trust because you may modify or terminate the trust during your lifetime, as long as you are not incapacitated.
The main attraction of a revocable living trust is to avoid the probate process. A trust may bypass the probate process because it is said to “live on” after the grantor’s death. In order to avoid the probate process, all of the grantor’s assets must be transferred into the trust prior to death. If all of the deceased assets are not in the trust, the estate may be subject to probate.
A living trust will also keep the distribution of the estate a private matter because it is not public record like the probate process.
A living trust will not exempt you from taxes or debts to creditors.
Creditors may claim debts from a trust up to two years after the death of the grantor. Because of this long waiting process, some trustees will submit the estate to probate simply to take advantage of the fact that creditors will only have a three month window to collect debts owed.
It is important to talk to a Florida Estate Planning Attorney about these issues so the trust you create can be tailored to your specific situation. If you are interested in writing your Last Will or creating a trust for your future needs, then contact Boyer Law Firm today.