A revocable living trust is a good choice for people who would like to avoid probate. This is a legal process that an estate must pass through before the heirs receive their inheritances when a will is used to arrange for asset distributions.
Why would you want to avoid this process? There are a few different reasons. One of them is the fact that probate is a public proceeding, and anyone can access the records. You may want your final affairs to be conducted confidentially.
The second reason why probate is often avoided is because it doesn’t happen overnight. Depending on the case in question and the jurisdiction it can take perhaps eight or nine months to multiple years for the estate to be probated.
Thirdly, probate is not free. The court will impose costs, the executor or executrix is entitled to payment, and there may be a probate attorney, an accountant, and an appraiser involved. These costs can be considerable, and this is all money that could have gone into the pockets of your heirs.
When you use a revocable living trust assets will be distributed to your heirs after your passing outside of the probate process.
While probate avoidance is the primary reason why people use these trusts there is another very useful element. You can name a disability or successor trustee when you are drawing up the trust agreement.
This individual would be empowered to handle the assets that you placed into the trust if you were to become incapacitated. Given the widespread nature of Alzheimer’s disease and the fact that people are living longer lives incapacity planning is something that everyone should take seriously.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.