When a person gets older, he has to consider all available options by which he can protect his assets should he become incapacitated due to age. As an estate planning attorney New York will explain to you, there are, of course, many options available, and each option will be better suited for certain kinds of estates and personal wishes. Estate planning documents and tools are made to be individualized and flexible, and an estate planning attorney will offer you guidance in drawing out an estate plan that best satisfy your wishes to protect your property and family. One of these documents is a revocable trust NYC.
A trust is an estate planning tool which you can transfer your assets into, while naming a third party as a trustee and putting that person in control of your assets. When you die, you trustee has the responsibility of transferring those assets in the trust to your heirs as you have instructed in the trust document. Trusts may be revocable or irrevocable.
A revocable trust NYC, also called a living trust or a revocable living trust, is a type of trust which, as the name suggests, takes effect even when you’re still alive, and can be altered or revoked anytime as you deem fit. Not everybody requires a revocable trust in their estate plan. The major reason why New Yorkers create this type of trust is it gives them a level of control over their assets even when they have become ill and incapacitated due to age, and it avoids probate.
Establishing a revocable trust NYC
A revocable trust NYC is established by the Grantor (the creator of the trust) and is effective during the lifetime of the Grantor. Note that the assets protected by the trust are only those transferred into the trust and as such, one should be careful when transferring assets into a trust. Joint accounts, retirement accounts and IRAs cannot be transferred into a trust. An estate planning attorney NY can advise you in this regard.
The Grantor maintains control of the trust by naming himself as the trustee. The American Bar Association states that you as the grantor of a trust can name yourself as a trustee, while naming one or more persons as co-trustee(s). Your co-trustee is bound by law to carry out all instructions which you have written down in the trust. You have the authority to change such instructions at anytime as you so please, or cancel the trust altogether or change your trustee, hence you still maintain some level of control over your trust assets. Your trustee or co-trustee is responsible for handling your finances and trust assets as instructed by you, make medical decisions on your behalf should you become incapacitated, and would be responsible for transferring your trust assets to your named heirs at your death.
Benefits of creating a revocable living trust NYC
- One major advantage of creating a revocable trust NYC is its avoidance of probate. With a revocable trust, all assets which you’ve put in the trust will go directly to your heirs (through your trustee) without having to be probated in a New York Surrogate’s Court. For this reason, people prefer having a living trust to a living will, as a living will do not dispose off assets. Also, a last will and testament must have to be probated in a court, thus incurring court fees, attorney fees, time and other expenses not incurred when you create a living trust. Only assets which are in your name will be probated, and a trust asset is not one of these because the trust is the legal owner and not you.
- Another benefit of creating a revocable living trust NYC is it gives you the power to leave property for your minor children in the hands of a trustee until they reach the legal age to manage su property themselves.
- When you become incapacitated, a revocable trust saves you the stress of applying for conservatorship or guardianship, as you have already appointed a trustee to handle your affairs when you become incapacitated.
All in all, it is in your best interest to know if a revocable trust NYC is the best option for you based on the kind of estate which you own, and your wishes concerning the estate. It’s advised you speak with an estate planning lawyer NY and expose to him your personal wishes and desires.