The Revocable Trust
One of the most common tools to include in a comprehensive Naples estate plan is a trust and a revocable trust is certainly one of the most popular due to its flexibility, privacy, and other benefits. A Revocable Trust is often referred to as a Living Trust due to the fact that while the grantor is still living, they have control over many aspects of the trust. The grantor is the creator of the trust. If you decide to have us add a revocable trust to your estate plan, you are the grantor.
Benefits of a Revocable “Living” Trust
Firstly, it allows you to change aspects of the trust while you are alive so you can do things like add assets to the trust or remove them, change beneficiaries, change the trustee, or revoke the trust altogether. It allows for seamless asset management during incapacity, ensuring a trusted individual (the trustee) can handle your trust affairs without court intervention. Additionally, it avoids probate, saving time and costs while maintaining privacy since probate records are public.
Finally, revocable trusts enable efficient distribution of assets to beneficiaries upon the grantor’s death. A will, which is another tool to distribute assets, goes through probate, so the details are not private, and probate can be a notoriously slow process, so beneficiaries must wait for the probate court to complete the process before assets are distributed.
In Florida, this trust type provides protection against potential challenges, ensuring your wishes are upheld. It also accommodates out-of-state property, simplifying multistate estate planning. Finally, the flexibility to amend or revoke the trust allows for adaptability as circumstances change, making it a versatile choice for individuals seeking comprehensive and customizable estate planning solutions.
What is a Revocable Trust?
In a revocable trust, the creator of the trust called the grantor, can dictate how their property will be managed and distributed after their death or incapacity. If you create a trust as part of your estate plan, you are the grantor. You would name your trustee and beneficiary(ies).
Unlike an irrevocable trust, a revocable trust can be modified or canceled after it is created. The grantor can change any part of the trust document, including adding or removing beneficiaries, changing the trustee, adding or removing property, or modifying how that trust property will be managed. When the grantor dies, the trust automatically becomes irrevocable and is managed by your named trustee.
What are the Benefits of a Revocable Trust in Naples?
There are several advantages of revocable trusts in Naples.
1. Revocable trusts provide flexibility. Circumstances change, and a revocable trust allows you to adapt to life’s changes. A revocable trust gives you the freedom to change your mind.
2. Revocable trusts allow you to plan for incapacity. Unlike a will, a revocable trust goes into effect when you become incapacitated and cannot make decisions for yourself. The successor trustee can step in and manage your trust assets on your behalf. You can include instructions in the trust for how you want the property managed, including whether the trust property should be used to pay for your care.
3. Revocable trusts avoid probate. Property held in a revocable trust bypasses probate and goes directly to the named beneficiaries. Your loved ones will avoid the time, cost, and stress of probate. A further benefit of avoiding probate is that your trust document will remain private. It will not become part of the public record.
What Are the Negatives of a Revocable Trust in Naples?
1. Property held in a revocable trust is not safe from creditors. The assets are treated the same as if they were owned in your name.
2. May be subject to estate tax. Florida does not have inheritance or estate tax. However, the revocable trust property is subject to federal estate tax if the value of your estate is over $12.92 million ($25.84 million per married couple).
3. Assets could result in disqualification from public benefits. Revocable trust property is counted towards the asset limit for public benefits, such as Medicaid. A Special Needs trust would be a better option.
As a Naples trust attorney, Attorney Nici can explain the benefits and drawbacks of trusts as they may apply to you. Together you can decide about creating a trust as part of your estate plan.
Call Naples Trust Lawyer James Nici
Revocable trusts should be set up with the help and guidance of a trust attorney. They are complex legal documents that must strictly follow Florida’s laws. James R. Nici is a qualified Naples trust lawyer who can help you create a trust that meets your unique needs.
If you have questions about revocable trusts, trusts in general, or any aspect of estate planning, contact the Nici Law Firm. James R. Nici is an experienced Naples attorney with over 25 years of experience. He has helped countless clients in Florida over the years and he can help you too. Contact our office today at (239) 449-6150 or use our web form to set up a free consultation.