Frequently Asked Questions About Funding A Living Trust
Do I need to re-title assets to add them to my trust?
Yes. Signing your trust is only part of the task. The trust must also be funded, that is, assets which you wish to be in your trust need to be re-titled in your name as Trustee. For a couple, title is generally in both names as Co-Trustees.
How do I put my home in the trust?
Funding the trust with the family home is accomplished by executing and recording a trust transfer deed, which we prepare. We also provide you with practical advice about how to fund your trust with your other assets such as bank accounts and securities. If the trust is not properly funded, court involvement, including possibly a probate action, may be necessary after you die.
Will re-titling my home in the trust cause a re-assessment?
No. A transfer to a revocable trust is not a "change of ownership" for property tax assessment purposes.
Should I re-title my retirement accounts or life insurance policies in my name as Trustee of my Trust?
No. Retirement accounts, such as IRAs and 401-Ks, should not be re-titled in your trust name; doing so will accelerate all of the deferred income. Such accounts will avoid probate because the proceeds will be distributed directly to the beneficiaries you have named on the accounts. Life insurance will also be distributed upon your death to the beneficiaries you have named.
You can name your living trust as a beneficiary of your retirement accounts or life insurance. However, we generally recommend that you do not name your trust as the beneficiary of your retirement accounts unless your intended beneficiaries are minors or otherwise unable to manage their affairs.
Should I re-title all of my bank accounts in my name as Trustee of my trust?
You certainly can. But this is probably not necessary and may not be advisable. See answers to FAQ regarding Bank Accounts.