Assets That Can and Cannot Go into Revocable Trusts
Hearing the term trust or trust fund, do you instantly make a connection with something you might have come across in a movie or TV show where a trust fund billionaire shows off the things they can do because they are rich? Believe it or not, there is more to trusts than spoiled rich kids blowing away their parents’ hard-earned money on useless things.
The reputation trusts have gained due to popular culture doesn’t encompass the relevance they have for people who are not rich. Trust funds are a vital part of estate planning. It matters little if you are the owner of a château in France or just a small apartment owner in Long Island with a decent amount in savings. A trust fund allows you to protect the financial security of your loved ones when you are no longer there using the property that you own.
Plenty of people avoid estate planning. After all, the basis behind the need to have an estate plan is not something that many people look forward to. Alas, there are but two things certain in life: death and taxes. You deal with the latter until the first one renders you are not able to deal with it, but you cannot avoid either of them.
Taking care of the people you love the most once you are no longer in their lives means it is crucial for you to take on the ominous task of estate planning.
The best estate planning lawyers in Long Island can help you sort all of this out.
Revocable Trusts
Depending on your requirements on how to distribute the assets you own, you can choose between two main categories of trusts: revocable and irrevocable. Both of these trusts are living trusts, meaning that they will be created during the course of your life.
Revocable trusts are a kind of trust that describes estate planning documents with terms that you can change at any time, as long as you are alive. The changes you can enact in your revocable trust can be something as simple as choosing another person as a beneficiary of a particular asset you were considering for someone, or making broader changes to how you want your assets to be distributed among your beneficiaries.
We are going to focus on revocable trusts since they offer a few significant advantages over irrevocable trusts. This also encapsulates the possibility of completely discarding the trust. Contacting your estate planning lawyer to scrap your revocable trust in Long Island is quite easy.
A significant advantage through revocable trusts is being able to circumvent probate in its entirety. After you create the revocable trust and finalize documents, you will need to retitle your assets so that you can fund it. Not everything you own can and/or should be retitled in the name of your revocable trust.
Assets Applicable for Revocable Trusts
Let’s take a look at what assets you can retitle in the name of the revocable living trust when you are setting it up.
Cash or any of your accounts containing cash
Nonqualified annuities
Any personal property
Life insurance
Personal loans you have not collected
Patents
Trademarks
Brokerage accounts
Copyrights
Royalties
Real estate
Rights to natural resources like minerals, gas, and even oil
Business interests
Bonds you hold in certificate forms
Stocks you hold in certificate forms
These are assets you can retitle in the name of your revocable trust in Long Island. You can ask the best estate planning lawyer to fill you in on the details of each asset to help you understand them better.
Assets Not Applicable for Revocable Trusts
Another advantage of a revocable trust is that the document will not just offer financial safety and security for the people you care for after you pass, it can also be beneficial throughout the time you’re alive as well. It is just that not all of your assets can or should be retitled to your revocable trust in Long Island.
These are assets that cannot be retitled to your revocable trust.
Uniform transfers or uniform gifts to minors
Qualified retirement accounts
Qualified annuities
Health and medical savings accounts
Assets That You Technically Can but Shouldn’t Retitle to Revocable Trusts
When making a revocable trust in Long Island and working with the best estate planning lawyers in Long Island, there will be a few applicable assets that you will come across. But your lawyers might suggest that you reconsider retiling them.
Life insurance policies
Vehicles
Qualified retirement accounts
Certain assets are technically qualified as assets that you are legally allowed use to fund the revocable trust in Long Island. However, you should always refer to estate planning lawyers in Long Island before considering them. Some states do not accommodate people for the purpose of creditor protection when there are revocable trusts involved.
Similarly, you can face various issues with vehicles and qualified retirement accounts, so it is best to refer to an expert and seek their opinion.
Final Thoughts
There are plenty of intricacies involved when it comes to handling your estate planning. It is a daunting task, but taking care of it is imperative so that the people you love are not left to pick up the pieces when they are already reeling from the reality of you no longer being in their lives.
Talk to qualified professionals and educate yourself on the details of estate planning and understand revocable trusts so that you can make the most of it.
