Mission Viejo Trust Attorney
MISSION VIEJO TRUST LAWYER
Though it can be hard for some to address, it’s necessary to determine what will happen to your property and assets after your death. Trusts are an essential way to protect your assets and help ensure they make their way to your loved ones after your passing. You can create a plan for what will happen to money, accounts, real estate, and other assets during your lifetime with a trust. This provides your loved ones with less to worry about after your death and better financial security.
Without an outlined plan for your assets, your loved ones may have to deal with the lengthy court process of probate. Not only can this take years, but it can be costly. Estate planning is necessary in California to prevent loved ones from going through this process during their grief. It’s important to put time and thought into the creation of an effective trust, and one which is legally sound. A trust and estate planning attorney can make the creation of a trust much easier and be sure that it is secure and legally binding.
THE LAW OFFICE OF CHRISTOPHER P. WALKER, P.C.: YOUR ESTATE PLANNING ATTORNEY
Our office has decades of estate planning and trust creation, and we want to help to craft a trust that provides you peace of mind and keeps your assets secure. A trust is not the only aspect of estate planning, but it is one of the most important. If you become incapacitated or die, a trust keeps your assets with your loved ones. It can provide you and them with a secure financial future.
At the Law Office of Christopher P. Walker, P.C., we want to help you understand the function and specifics of the trust you are creating and be sure that it meets your specifications. At our firm, we believe in careful attention to detail and personalized legal counsel. We focus on communication and quality of service and want to help you create a will that you can feel secure with.
Creating a Trust
A trust holds your assets while you’re alive through a legal entity. You, the trustor or grantor, give legal ownership of the assets in it to another party, the trustee, after your death. The trustee may be a loved one, such as a family member, an institution, or another professional that you trust, such as an attorney. It’s important that the person or institution you name your trustee is someone you can trust and is financially and legally responsible.
Before you pass, you are usually considered the trustee, and the contents of the trust are still yours. If you feel you are unable to look after your trust while you’re alive, you can name someone else the trustee and yourself the beneficiary, continuing to allow you access to your assets. You may feel that you are too busy to properly handle the trust or that you don’t have the financial and legal understanding to take care of it.
Whether you are considered the beneficiary or the trustee at the time of trust creation, you must name a trustee when you pass. When you die, the trustee you named will have the job of taking care of your trust and distributing its contents according to your directives. The trustee is also responsible for taxes and other important legal and financial matters. They are legally liable if they poorly manage your trust and cause damages. The person you appoint as trustee must understand these responsibilities.
In the document, you can name beneficiaries to the contents of your trust. They may be loved ones, family members, or other beneficiaries. They will inherit your assets, and the trustee will distribute the contents to them. The trustee and the beneficiaries are part of a fiduciary relationship once the trust is created, meaning that the trustee must act in the best interests of the beneficiaries. A trustee is not allowed to take any action that is against the best interests of the beneficiaries.
ASSETS INCLUDED IN TRUSTS
A trust’s contents may include a number of personal assets and real estate that you want beneficiaries to be given. This includes:
- Personal property and other real estate properties
- Cars and other vehicles
- Savings accounts and other bank accounts
- Retirement accounts
- Life insurance and insurance policies
- Businesses and companies
- Investments such as stocks and bonds
- Expensive assets such as jewelry or artwork
- Family heirlooms
- Intellectual property such as patents or trademarks
- Limited Liability Companies (LLCs)
These are only some of the assets you may have as a part of your trust. You can discuss with a Mission Viejo estate planning attorney what additional assets you could include in a living trust.
WHAT IS A LIVING TRUST?
This is what your trust is called during your lifetime. During this time, you can change it, and it is considered a revocable trust. Amendments to this type of trust may include changing the trustee, changing beneficiaries, or other directives. You can even terminate the trust. If the individual is no longer able to make decisions competently or they pass, the trust becomes irrevocable.
REVOCABLE VS. IRREVOCABLE TRUST
Usually, the living trust is called revocable, and it becomes an irrevocable trust once you pass or are no longer competent. However, it is possible to create an irrevocable trust while you are still alive. If you want to create a living trust that is irrevocable, then it cannot be changed, even by you. A trust that is revocable can be altered as you want it to be.
Benefits of a revocable living trust:
- You have more control over the contents.
- Life changes can be reflected in the document.
Downsides of a revocable living trust:
- The trust doesn’t protect you from creditors.
- Estate taxes can apply when you die, both state and federal.
Benefits of an irrevocable living trust:
- The trust is not subject to state and federal estate taxes.
- It can allow your loved ones to avoid the probate process completely.
Downsides of an irrevocable trust:
- You have no way to change the contents.
- To add other assets to your trust, you must create a pour-over will.
To determine what trust is the best option for you, your assets, and your loved ones, talk with an experienced trust attorney in Mission Viejo, CA.
DO I NEED AN ATTORNEY FOR A LIVING TRUST IN CALIFORNIA?
While it is possible to create a trust without legal counsel, it’s very complex and not often advisable. If you only have one beneficiary or few assets, it’s less complex, but the more assets and people named in your trust, the more difficult it is to complete on your own. You want your living trust to be legally sound, or else it may not even hold up after your death. Not only do you need to draft it correctly and account for the specifics of your assets and circumstances, but you also need to correctly transfer your assets to the trust.
Each trust is unique, and effective legal counsel can walk you through the process, file the correct legal documents, and be sure that the trust covers all the necessary provisions for your situation. A trust attorney has experience with the varying aspects of many trusts and can use that experience to personalize your trust to your needs.
A trust is often one part of estate planning. By working with an attorney on your living trust, they can also assist you with your will, Power of Attorney, and medical care plan. This allows your attorney to have a better understanding of your situation and bring personalized counsel to each aspect of estate planning.
WHAT DO LAWYERS DO FOR A TRUST?
When you hire an experienced estate planning and trust attorney, they can help you create a trust document and transfer assets to the trustee. Whether you name yourself beneficiary or trustee, the assets must still be transferred into the legal entity of the trust. Working with an attorney gives you confidence that the trust will play out according to your wishes.
An attorney also provides you with an extra set of eyes to look over the specifics of the trust. This set of eyes is also highly experienced in living trusts, so their professional guidance is invaluable, and they can catch serious mistakes that could lead to legal trouble for your beneficiaries or your trustee. They can help ensure it is as legally enforceable as it can be.
Working with an attorney means they can check in with you regarding revocable trusts and be sure it’s up-to-date. They will also be able to review the assets you place into your trust to ensure that listed beneficiaries don’t conflict with the terms of your trust. Overall, a trust lawyer provides you with the most security for your trust.
WHAT IS THE DIFFERENCE BETWEEN A TRUST AND A WILL?
Wills and trusts accomplish different things, but they both makeup estate planning. Where a trust will help your loved ones avoid the probate process, a will won’t do the same. A will is used during probate to explain to the court where you wish for assets to be distributed, but the final decision regarding the will and its validity is up to the court. A will may also state who you wish to have control over the asset distribution process, but again, the final decision is up to the court.
A trust avoids probate and its fees, while a will can’t. If you have a trust, you still likely need a will as part of your estate planning. A trust will keep your assets out of probate, but any assets that are not in it should be addressed by your will. Those assets will go through probate even when you have a trust. Your attorney can help you determine which assets should be in your living trust and which should be in your will.
WHAT IS THE AVERAGE COST OF A TRUST IN CALIFORNIA?
A trust in California may be anywhere from $1,000 to $4,000. An irrevocable trust is more expensive than a revocable trust.
Without a trust, probate fees could severely impact the assets given to your beneficiaries. The greater your estate, the more probate is likely to impact it. Though a trust is costly, the legal fees, time in court, and assets lost to probate outweigh the cost. A badly formed trust could create the same legal issues alongside additional fees.
HOW DOES PROBATE AFFECT MY ASSETS?
If you die without a trust and the value of your estate is over a certain amount, the estate goes through probate. This is the court’s process of deciding the validity of your will, handling any debts you owe after your death, and transferring your assets. It’s a time-consuming process, taking anywhere from nine months to three years, depending on how many assets you own. It’s a very public process, and creating a trust allows your assets, beneficiaries, and other information to remain private.
Probate is also very expensive, both costing fees and taking estate taxes from your assets. Estate taxes could be as much as 50% of the property value. This will severely limit the benefits your loved ones see from your assets. Estate taxes could still apply to some trusts, but they will be more limited than they are through probate. Creating a trust allows you to bypass the probate process and save your loved one time and headaches.
Creating a will won’t prevent your assets from entering probate, but a well-made trust will. A living trust makes you no longer the sole owner of the assets. When you pass, the legal entity of your trust and the trustee have ownership over your assets, keeping them free from the probate process. A trust gives you the security that you have control over where your assets will go after you die or are incapacitated and creates more legal certainty for you and your loved ones.
PROVIDING SECURE ESTATE AND TRUST PLANNING IN MISSION VIEJO
If you believe that creating a living trust, revocable or irrevocable, is the right move for you and your estate, you need reliable and detail-oriented legal counsel. The Law Office of Christopher P. Walker, P.C., has the necessary experience to guide you through this complicated process and ensure that you understand the benefits and security you’re gaining from your living trust. Contact our office today to determine your estate plan.