Overview
A Living Trust is a trust created by an individual, known as the trustor, during their lifetime. The trustor transfers ownership of their assets into the trust.
Full Details
What is a Living Trust?
A Living Trust, also known as a revocable trust or an inter vivos trust, is a legal document created by an individual, known as the trustor, during their lifetime. The trustor transfers ownership of their assets into the trust, and those assets are managed by a trustee for the benefit of the trust's beneficiaries.
What are the benefits of creating a Living Trust?
- Avoid Probate: Unlike a will, a living trust does not go through probate, which can be a time-consuming and costly process. Assets in a trust can be distributed to beneficiaries more quickly.
- Privacy: A will becomes a matter of public record when it is probated, while a living trust can allow the distribution of assets to remain private.
- Control: A living trust allows the trustor to maintain control over their assets during their lifetime and provides clear instructions for management and distribution after their death or incapacitation.
- Incapacity Planning: If the trustor becomes incapacitated, the successor trustee can take over the management of the trust assets, avoiding the need for a court-appointed conservator or guardian.
- Potential Tax Benefits: Depending on the specifics of the trust and the trustor's estate, there may be tax advantages to creating a living trust.
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