A revocable trust is a type of trust which gives the creator of the trust (known as the Grantor) the power of protecting his assets by transferring them into a trust while still having control over what happens to such assets. A revocable trust is also known as a living trust. As described by the name, a revocable trust Queens is revocable, that is, subject to changes so long the Grantor remains alive.
By naming himself as a trustee of the revocable trust, the Grantor has the power to instruct his co-trustee on what to do in the management of the trust assets. Only those assets which are transferred into the revocable trust will be managed by the co-trustee. Once transferred, the assets are no longer entitled to the Grantor’s name but to the trust. The Grantor retains the power to revoke the trust at anytime and reclaim ownership and full control of the assets.
Difference between a revocable trust and a living trust and testamentary trust
A testamentary trust is a part of a last will and will only take effect after the death of the testator/grantor.
A living will, on the other hand, is effective during the lifetime of the testator. A living will gives protection to the testator during incapacitation, but has no power to transfer assets to beneficiaries at the death of the testator.
But the revocable trust Queens takes effect from the moment it is funded with assets (transfer of assets into the trust) and remains effective even after the death of the grantor until such assets are passed on to the named beneficiary. It also offers protection to assets during incapacitation, by handing over managerial duties to the trustee.
Advantages of a revocable trust over a last will and testament
A revocable trust Queens give you the power to protect your assets during your lifetime. When you become incapacitated, your trustee or co-trustee takes on the responsibility of managing your finances.
A revocable trust Queens will provide the grantor with the following benefits:
- A last will and testament must pass through probate – a court procedure for checking the validity of a last will – before it becomes effective. This attracts a lot of court fees and takes a lot of time. But with a revocable trust Queens, probate is avoided. In Queens, this becomes doubly important because the Uniform Probate Code, a system which can significantly shorten the probate process, is not in use here.
- A revocable trust is not accessible to the public, unlike a last will. It protects Grantor and beneficiaries’ privacy by transferring the trust assets without having to go through any public legal procedure.
- Assets in the revocable trust will be available for distribution immediately after the death of the grantor, thus insuring sufficient funds are available to take care of estate taxes.
- In the event the grantor or beneficiary is found to be disabled, sick or incapacitated, the trust assets will continue to be managed by the trustee pending when their situation gets better. This is also true when the beneficiary of the trust asset is a minor.
- Contests which are common with wills are completely out of your worries when you create a revocable trust Queens. Attacking the terms or instructions of a trust are very difficult.
However, creating a revocable trust comes with some disadvantages.
Disadvantages of creating a revocable living trust
- You must be ready to give up complete ownership of any asset which you so desire to transfer into a revocable trust during your lifetime. However, you can reclaim ownership when you revoke the trust.
- Attorney fees for preparing a revocable trust Queens are significantly higher than that required for preparing a last will.
- Some people do not transfer all their assets into the revocable trust. In such situations, a last will must also be created to cover for the left-over assets.
Having a revocable trust does not generally eliminate the need for a last will and testament. In fact, you may have no need for a revocable trust Queens. Also, assets transferred into the revocable trust are not protected for the purpose of qualifying for Medicaid or long-term care. In fact, trust assets must have to be spent down if it exceeds the Medicaid threshold, since the assets are still considered as part of the Grantor’s resources should the trust be at any time revoked.
In conclusion, one should consult an estate planning attorney specialized in trusts for guidance before creating a revocable trust Queens.