REVOCABLE LIVING TRUSTS
© Copyright 2011 Lee A. Drizin, Chtd.
1. What is a Trust?
A Trust is simply a means of holding and transferring property. A Trust serves as a Will substitute. In other words, property placed in a Trust will pass pursuant to the terms of the Trust as opposed to a Will at your death.
2. Are there different types of Trusts.
Trusts can be revocable or irrevocable. An Irrevocable Trust is one that once created cannot be revised or revoked. A Revocable Trust, as its name implies, can be changed or amended by the creator of the Trust (known as the "Trustor") at any time, unless the Trustor is deceased or incapacitated.
3. Do I lose control of my property if I use a Trust?
No. A Trust involves three parties: the Trustor, the Trustee and the Beneficiary. The Trustor is the person who creates the Trust. The Trustee manages the trust property and has the fiduciary responsibility for administering the Trust Estate in accordance with the terms of the Trust document. The beneficiary receives the income and/or principal from the Trustee. While the use of an Irrevocable Trust requires you to relinquish control of the Trust and the property owned by the Trust, a Revocable Trust does not. A Revocable Trust is created by you, and controlled by you for your benefit during your lifetime.
4. What is a Living Trust?
Funding is the process whereby your assets are transferred into the name of the Trust. Once this is accomplished the Trust now owns that asset. For real property this is accomplished by the execution of a Deed. For an automobile this would be accomplished by changing the ownership of the car on the Certificate of Title. A Living Trust is a Trust that is funded while the Trustor is alive. After the death of the Trustor, the assets in the Trust will be distributed in accordance with the terms of the Trust and avoid probate.
5. What are the advantages of the Revocable Living Trust vs. other alternatives?
A. Privacy. A Revocable Living Trust is not required to be filed with the Clark County Clerk’s Office. The only person who will know the contents and substantive provisions of your Trust will be yourself, your attorney and anyone to whom you disclose those terms to. As a result, the amount of your assets and the distribution scheme for your beneficiaries is kept confidential.
B. Don’t I execute a Will in conjunction with my Trust? Yes. However, the Will is merely a safety valve. In other words, all the property you own (with certain limited exceptions) should be transferred into your Revocable Living Trust. At your death, if there is any property that is found not to have been transferred into the Trust, the Will should be probated in order to facilitate the transfer of that property to the Revocable Living Trust. The Will provides that any property not in the Trust at the time of your death should be poured over into the Trust and distributed in accordance with its terms. This Will is commonly referred to as a "Pour Over Will". Even though the Pour Over Will may be filed in the event there is property that is not in the Trust at the time of your death, the Trust document itself does not get filed with the Clerk’s Office. Accordingly, privacy is maintained.
C. Expediency. The persons you nominate as Successor Trustees may assume this responsibility immediately upon your death. Unlike a probate proceeding which may last six (6) to nine (9) months before the proceeds are ultimately distributed to your beneficiaries, the Trust enables the Successor Trustees to immediately commence administration of the Trust assets. Generally, after the expiration of a 90 day creditors notice the Successor Trustee will be in a position to distribute the assets of the Trust.
D. Avoidance of Attorney’s Fees. The Revocable Living Trust is a method to avoid significant attorney’s fees associated with Probate. In general, attorneys in Clark County, Nevada charge a percent of the gross assets of the estate in order to probate an estate. Our firm charges a flat fee for preparation of an Estate Plan which includes a Revocable Living Trust and, generally saves significant attorneys fees otherwise incurred.
E. What fees does our firm charge for a Revocable Living Trust? The fees charged by our firm for the preparation of your Estate Plan (which includes your Revocable Living Trust) are a flat fee and do not vary depending upon the size of your estate. The fee for a Trust for an individual is $2,500.00 and for a couple is $3,500.00. This fee includes the preparation of a deed transferring your primary residence into the Trust.
The information presented herein is general information only and should not be considered legal advice nor should you rely solely upon this information in taking any actions regarding your matter. While no attorney-client relationship is formed by supplying this information, please do not hesitate to contact us at (702) 798-4955 to schedule a time to discuss your particular circumstances.