By: Kristin K. Vanpraet

Attorney & Counselor at Law

Shepard Law Office PLC

Myth 1: If you do not have an estate worth more the 3.5 Million which triggers tax issues; you do not need a living trust.

Avoiding taxes is just one of many reasons to have a living trust, and may not be the the most important reason to you.  Having a living trust also gives you many advantages, some of which include:

1.    It avoids probate. If you die with any type of property or money, and have no estate plan or only a will, your estate will have to be probated.  By establishing a living trust, anything owned by your trust will pass outside of probate, thus avoiding the hassles of probate.

2.    It allows you to maintain control of your money. By establishing a living trust, you can place conditions on beneficiaries and maintain control of how your money and property is distributed, not just to who but also when and how.  For example, if you want your child to receive his or her inheritance only after completing medical school, you can make that condition part of the trust.  The trustee you appoint will hold the child’s inheritance in the trust until the child has completed medical school.  This is just one example of the control a living trust allows you to maintain after your death.

3.    It maintains privacy. Because a living trust does not have to go through the probate system, the terms of your estate will remain private.  When an estate is probated in court, there is a public record – of all property and assets, a trust avoids probate and thus, no public court record.

4.    It will protect your interests if you become disabled. Unlike a will which becomes effective only when a person passes away, a trust can become effective immediately. Why would you want to do this? Statistically is more likely that you may become disabled or have limited ability at some time in your life before passing away. With a trust in place you can make sure that all your bills are paid for if you are not able to do it yourself.

Myth 2: If you put your property into a trust, you no longer own or control that property, the trust does.

When you create a revocable trust, as the trustee of that trust, you always control the property and money in the trust. The property may be titled to the trust but you still have ownership. You will always have the ability to buy, sell, and control the property however you want. You also have the ability to revoke the trust at any time.
In conclusion, a living trust does not need to be complicated; it can be as simple or as complex as you wish it to be. However all trusts should be prepared specifically for you by a professional estate planning attorney because everyone has needs and desires. An estate planning attorney will help you decide what options are best for you.