What is the purpose of a Living Trust?
A living trust is a document which takes ownership of your assets when you pass way or become incapacitated. The purpose of the trust is to avoid probate so your assets can go to your heirs more quickly and with less expense. This will also dictate how your assets go to your heirs if you want to make sure your heirs don’t get control of everything when they turn 18.
Do I need to file a tax return for my trust?
No. A living trust does not actually come into existence until you and/or your partner pass away or become incapacitated. Once that happens, the trust comes into existence and tax returns need to be filed along with bank accounts for the trust.
What assets need to be moved into a trust?
Real property is the major thing that needs to be placed in a trust
Brokerage accounts outside of retirement accounts
Corporations, LLCs and LP ownership interests
Royalties, copyrights, trademarks, patents and other intellectual property rights.
Oil, gas and mineral rights
Some annuities
What assets do not belong in a trust in general?
Retirement accounts such as 401(k)s, IRAs, 403(b)s, etc.
Life insurance
Day to day checking and savings account
What do I do with my trust once it is signed and notarized?
You want to let the people named as trustees and beneficiaries know where it is
Place it somewhere safe but accessible
How often should I update my trust?
I generally recommend updating these documents every 10 years.
They should be updated more often in the case of major life events such as births, divorce or major changes in net worth.
Where can I get more information about the end of life questions?
There are no right or wrong answers here.
It is important to note that the choices you make here will not be definitive. Your healthcare agent will make the final decisions. However, this will guide your agent.
Relief from pain (This is from the Australian government but it is a good set of information)
