What is a Living Trust?
A trust is an arrangement that one person called a trustee, holds legal title to property for another person, known as a beneficiary. You may be the trustee of your own living trust therefore allowing control over all the property held in trust. The living trust is created while you are alive and the beneficiaries that you name in your living trust receive the trust property when you die.
An irrevocable trust may not be modified or revoked after they are signed and are useful for situations such as reducing taxes but require you give up ownership and control of the trust property.
The advantage of a living trust is to avoid the expense of probate court proceedings after your death. If your net worth is under $75,000, when you die then the probate process should be relatively inexpensive and not protracted, so you may not need to be concerned about probate with a living trust.
How to make a living trust in Florida.
To create a trust, it is best to consult an attorney to help you. The trust must pay taxes and the mechanics of the trust need to be written with great care and detail, the trust should be crafted by a person who has specialized knowledge of the legal and financial details.
Living Irrevocable trust fund
This type of fund can be set up to begin dispersing funds as certain conditions are met. You can place cash, stock, real estate and other valuable assets in your trust. Hire an attorney and decide on the beneficiaries and your stipulations. Although the trust is irrevocable, the money is not the property of the person receiving it. The trustor can establish trusts for the future generations of children. As it is irrevocable, you don’t have the option of dissolving the trust later. Once the assets are placed in the trust, they are no longer yours and are under the care of a trustee. A trustee can be a bank, or other entity set up. Since the assets are no longer yours, you don’t have to pay income tax on any money made from the assets. The assets can be exempt from estate and gift taxes. The tax exemptions are a prime reason that some people set up an irrevocable trust. If the trustor is in a higher income bracket, then setting up the irrevocable trust will let you to remove these assets from your net worth and move into a lower tax bracket.
The responsibilities of a Florida trustee will be different depending on the type of trust and the trust terms, all trustee has definite obligations. Many of the responsibilities are complicated and technical, such as identifying creditors and managing trust assets responsible for the good of he beneficiaries. The trustee plays a fiduciary role , meaning that he/she may be responsible to the beneficiaries of the trust if the assets are not managed properly. It is in the best interest of the trustee to hire an experienced trust administration attorney.
Don’t go it alone, representation is more affordable than you think .