Estate planning offers many tools to meet the specific needs of individuals and families. Trusts are a popular method to minimize estate taxes and provide other benefits. Among the types of trusts available, revocable living trusts (“RLTs”) offer the most flexibility and can offer benefits during the life and after the death of the trust maker (also called the “settlor”).

Creating a revocable living trust can reduce financial strain for beneficiaries now and in the future while also maximizing available assets. At Pierro, Connor & Strauss, we can determine whether a revocable trust or another estate planning vehicle is right for your situation.

What is a revocable trust?

Trusts are legal entities that separate the rights of ownership. The trust’s settlor has the right to make decisions about how the trust is created and about any property that is transferred to the trust. The beneficiary has the right to receive the benefits of the trust property. The trustee manages the trust assets according to its instructions.

When a living trust is revocable, it can be modified or revoked at the will of the settlor, allowing some measure of control during his or her lifetime. Revocable living trusts allow individuals to plan for how they want property to be managed during their lifetime or distributed after death. Irrevocable living trusts, by contrast, can only be changed in limited circumstances but offer greater asset protection.

A revocable living trust allows for flexibility, but it does not offer the same protections and benefits of irrevocable living trusts and other estate planning tools. However, a revocable living trust can be created in conjunction with other estate planning documents to achieve specific goals. Each situation is unique so speak with a living trust planning lawyer to decide whether a revocable living trust is a good option in your case.

Benefits of revocable living trusts

In addition to the peace of mind that comes with having a plan in place for one’s assets, revocable living trusts can provide practical and financial benefits. Some advantages can include:

  • Minimizing probate. Property that is already held in a trust at the time of the settlor’s death may bypass the probate process, saving the estate time and money. At death, the trust becomes irrevocable, and the property can be used to settle the creator’s taxes and debts before transfer to the estate or another named beneficiary.

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  • Preparation in case of incapacitation. Pre-planning places the settlor’s choice of successor in position to make decisions should a sudden, unexpected, or even expected incapacitation arise. This can include making medical decisions, and it avoids the process of going to court to appoint a guardian to make financial and/or medical decisions.
  • Tax benefits. Though a revocable trust does not eliminate estate taxes, it may be used to avoid gift taxes.
  • Protection of privacy. Taking property out of the probate process maintains privacy over personal and family affairs.

Pierro, Connor & Strauss consider both the short and long-term goals of our clients before making any recommendation. We want to make sure that any trust created works with your other estate planning vehicles and any change in circumstances.

Do I still need a trust if I have a will?

One of the benefits of a trust is avoiding probate. If you only have a will, then most assets will still need to go through probate. This can be minimized by creating a trust and drafting a will that work together. A trust created during one’s lifetime can be funded by instructions in the will to sidestep the probate process and simplify matters for beneficiaries.

Since wills and trusts in New York are both governed by state law, it is important to work with a trust lawyer who monitors updates to the statutes. The attorneys at Pierro, Connor & Strauss stay ahead of the curve so that we can alert clients of how legal developments may impact your existing planned wills and trusts.

Call Pierro, Connor & Strauss to learn more about forming a revocable living trust

Revocable living trusts must be created and managed with care. New Yorkers from Schenectady, Saratoga, or elsewhere in the Albany area are encouraged to speak with an estate planning lawyer at our firm. We also serve clients in Long Island, Hudson, Lake Placid and all New York City boroughs. You can also Contact Us online here to request a free consultation.

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