The Benefits of a
Revocable Living Trust
A Revocable Living Trust is the cornerstone to a comprehensive estate plan.
If you own real estate or your assets exceed the Small Estates Limit in your State, it is recommended that you establish and fund a Revocable Living Trust to avoid Probate and ensure your estate is passed to your heirs privately, without excessive fees and court involvement.
Whether you are single or married, there are many advantages to holding title to your assets in a Living Trust. This legal instrument is offered in the ULTRA Estate Planning Benefit Program to protect your estate from the traps put in place by the government. Click the headings below to read more about the advantages of setting up a Revocable Living Trust.
1. Avoid Probate
Holding title to your property in a Revocable Living Trust eliminates Probate Court from your estate. Probate is a court process that takes place upon your passing if you own real property or the value of your estate exceeds the Small Estates Limit (currently $184,500 in California). The process involves your heirs hiring an attorney to petition the Probate Courts, and the Court will choose who will manage and receive your estate. This judicial procedure can take one to three years and cost your estate thousands of dollars in court and attorney fees.
A Revocable Living Trust allows your estate to avoid probate upon your passing, and your property is managed and distributed according to your wishes stated in the Trust.
2. Management During Incapacity
Holding title to your property in a Living Trust protects your estate if you become incapacitated. Without a Living Trust, the court would appoint a conservator to manage your property and require the payment of court costs, conservator fees, and attorney fees while you are incapacitated.
By executing the proper legal documents while you are still healthy, your loved ones will avoid the costs and delays of dealing with court involvement and be able to manage your estate if you are unable to.
3. Control Distribution
With a Living Trust, you maintain full control of your assets during your lifetime. Upon your death, the provisions set forth by you in your Living Trust controls who is to receive your estate and what age it is to be distributed to them.
Additionally, if you have a child or beneficiary that is receiving benefits from the State, a Special Needs Trust is a legal instrument that can be set up to receive their inheritance without interfering with the benefits they are already receiving.
4. Saves Taxes: Income & Estate Tax
A Living Trust reduces Capital Gains Taxes, Federal Estate Taxes, and Gift Taxes.
If a property owned by a husband and wife is held in a Living Trust, the surviving spouse and will also receive a stepped-up tax basis on the primary residence held in Trust upon the death of the first spouse. This will eliminate some or all capital gains taxes if the surviving spouse chooses to sell the home. Another step-up is accomplished up on the death of the surviving spouse, reducing taxes once again for the beneficairy(ies).
5. Privacy
A Living Trust ensures your family’s privacy because the details of Trust Administration are not open to the public as Probate proceeding. There is no ad posted in the local paper regarding your passing or inquiries regarding claims against your estate, which is required during the Probate process.
ULTRA's Comprehensive Estate Planning Package
ULTRA's Estate Planning Benefit Program offers and educates families on how to avoid the probate courts, conservatorship, and other traps put in place by the government. This comprehensive estate planning program includes the following legal documents:
Revocable Living Trust
This document creates the entity to which you transfer ownership of your real property and liquid assets and contains instructions how these Trust assets are to be managed during your lifetime and distributed upon your death (as an individual) or death of the surviving spouse (if married). Allows your estate to avoid Probate Courts entirely and optimize estate tax law upon your death.
Certification of Trust
This document is a summary of the key terms of the Revocable Living Trust without revealing the private details of the Trust. This is to be provided to financial institutions when transferring ownership of your accounts to your Trust.
Pour Over Will
This document appoints an Executor for your Probate estate (if any) and Guardian for your underage children. The Pour Over Will references the execution of a Trust states that if any assets left out, or not transferred to your Revocable Living Trust during your lifetime will become part of your Revocable Living Trust upon your passing.
Financial Durable Power of Attorney
This document gives a person (or persons) of your choice authority to manage your assets and financial affairs if you are still living but lack the capacity to manage your own affairs due to an accident or illness.
Advanced Health Care Directive
This document outlines your wishes and gives a person (or persons) of your choice authority to make decisions regarding your health care if you are still living but lack the capacity to make your own decisions due to an accident or illness.
Real Property Transfer Deed
Trust Transfer Deeds necessary to properly transfer ownership of your real property to you Revocable Living Trust. These documents create the legal assignment of your property from you as individual or married persons, to you as Trustee(s) of your Trust.
Estate Settlement Program
All documents needed to transfer assets to the beneficiaries, real property county clerk paperwork filings, financial counsel provided to successor trustees and beneficiaries.