Question 1

What is Revocable Trust?

Accepted Answer

A Revocable Trust, also known as a Living Trust, is a legal arrangement in which an individual (the grantor or settlor) transfers assets into a Trust during their lifetime. The Trustor remains the owner of these assets and can amend, modify, or revoke the Trust at any time while they are still alive.

Question 2

What will the trust document cover?

Accepted Answer

Tax implications: When a property owner passes away, and the property held in Trust is transferred to a trustee, the Trustee inherits the property at its current market value and doesn’t pay the capital gains tax on the difference between the deceased individual’s purchase price and current fair market value when the property is sold. In the case of Joint Tenancy, the increase in cost basis on the home would not occur and the joint tenant could be subject to significant capital gains taxes. That means that your beneficiary could face a burdensome tax bill if your real property is ever sold.
Liability: Anyone on the deed is considered an owner. If you put someone on the deed that owns a business, has significant debt, owes the IRS, injures someone in a DUI accident, or has a personal guarantee on a loan, all homeowners would be liable.
Divorce: Suppose a property owner adds a joint tenant. That joint tenant is married and goes through divorce proceedings. The jointly owned home will pass through the divorce proceedings as an asset of the joint tenant and will be subject to proceedings as shared property.

Question 3

What are key elements of an Revocable Trust?

Accepted Answer

A Revocable Trust outlines how the assets will be managed and distributed during the grantor’s lifetime and after death.

It provides flexibility, privacy, and efficient asset distribution while avoiding the hassle, cost, and waiting period associated with Probate.

At Vanguard Legal Group, most Trusts we draft are revocable Trusts.

Question 4

Who manages the trust after someone passes away?

Accepted Answer

A Successor Trustee.Every Trust names a Successor Trustee. This individual or entity you’ve chosen as your successor trustee will take over responsibility for your estate if you are incapacitated or deceased. This person or entity must legally act on your behalf, not their own. Your Successor Trustee should be competent, organized, trustworthy, and highly ethical.

Revocable Trusts

Protect your loved ones and ensure your wishes are fulfilled.

Learn More About Revocable Trusts

3 Advantages of a Revocable Trust

Seamless Transfer of Your Assets

Maintain Privacy of Your Affairs

Continuous Access and Maintenance

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