A living trust is a written legal document where assets are placed into a trust for a person’s benefit during their lifetime and their beneficiaries benefit after their death. The successor trustee is put in charge of reallocating assets after the death of the individual who wrote the trust. The living trust is often selected over a will because it avoids probate and allows for a quicker distribution of assets after death. It also is a private document where as a will becomes public record after an individual’s death. One thing that is imperative with a living trust is that assets are continually accounted for and updated in the trust. When new assets are acquired and do not get added to the trust, a legal domino effect occurs.
Any unclaimed assets will need to be probated before they can be passed over to a living beneficiary. Heirs and beneficiaries will have to deal with probate processes in each individual state where property is owned. Every state has their own rules and laws that must be adhered to. Many living trusts will look to spread resources between different children and family members. If property is co-owned with a spouse or another member of the family and it is not accounted for in a living trust, it is likely that this individual will then become the sole owner. This can lead to confusion and drama for families after the individual death.
Individuals impacted the most by resources being left out of a living trust are minors. Children under the age of 18 cannot legally own any inherited property. With a living trust, the successor trustee is able to overlook the property until the beneficiary reaches the legal age. Whether the preferred benefactor is a child or grandchild, without the written living trust, adults will have to go to court and ask to be appointed the conservator for the child. This, ultimately, puts them in control of the future of the asset.
The only way to truly put beneficiaries in the desired positions of the writer of the living trust in the most stress-free way possible is by staying on top of every asset that will be divided out and ensuring that they are all accounted for in the living trust. The experts at Catanese and Wells have the experience necessary to handle any and all estate litigation issues. Contact us today to ensure your living trust is in the proper condition.