Living trusts can be an important part of some estate plans, especially for people who have special needs children who want to help their families avoid probate and/or who have other special circumstances/wishes.
To elucidate the benefits of living trusts and when people should consider setting them up, below, we’ll answer some of the most common questions about these estate planning tools.
When you are ready to set up a living trust or resolve any estate planning issue, contact an experienced Centennial trust attorney at J R Phillips & Associates, PC. Our lawyers are here to make sure that you pick the right living trust that works for you as well as for your family.
Answers about Living Trusts in Colorado
Q – What is a living trust?
A – Also referred to as intervivos trusts and revocable living trusts, living trusts are estate planning tools that designate a third party (the trustee) to manage certain assets (the trust funds/assets) behalf of another party (the trust beneficiary). With living trusts, the trustmaker can be the trustee, and the terms of the trust can be altered as long as the trustmaker is alive.
Q – When can living trusts be changed?
A – Whenever the trustmaker wants to, as long as the trustmaker is “able” or “of sound mind.” In fact, as long as the trustmaker is of sound mind, (s)he can amend or even revoke a living trust at any time.
Q – When is a living trust beneficial?
A – Living trusts can be appropriate for a variety of situations, as well as for people of different economic statuses. In particular, just some of the cases in which setting up a living trust can be a good idea include when a trustmaker:
- Owns real estate or assets in different states
- Has a loved one with special needs
- Wants to set up protections in the event of mental incapacitation.
Please be aware, however, that these are by no means the only situations in which it can be wise to set up a living trust and that it’s best to consult with an experienced attorney to find out more about whether a living trust would be appropriate for you and your circumstances.
Q – How are living trusts funded?
A – Living trusts (and other trusts) are generally funded by the trustmaker transferring property into the trust. For real property like real estate or vehicles, this can involve signing over the deeds or titles for the property to the trust.
Here, it’s important to note that living trusts can also be funded via a “pour-over will,” which can direct that certain property be distributed to the trust upon the trustmaker’s death.
Q – What happens to living trusts when the trustmaker dies?
A – When the trustmaker dies, a living trust will automatically become an irrevocable trust. After this occurs, the successor trustee will take over the administrative responsibilities for the trust. They will be responsible for managing the trust, and distributing its assets per the terms of the trust.
Contact a Denver Trust Attorney at J R Phillips & Associates, PC Today
Do you have more questions about living trusts? Would you like to know the difference between a will and a living trust? If so, You may contact our Local Attorney at J R Phillips & Associates, PC.
We can discuss your estate planning needs and different options during our consultation. To schedule this meeting, call us at (303) 741-2400 or email us using the contact form at the top of this page.
From our offices in Denver, we serve clients throughout the southwest and southeast Metro Area, including (but not limited to) people in Highlands Ranch, Littleton, Castle Rock, Parker, Aurora, Greenwood Village, Englewood, Centennial.