Revocable Trusts: Wayne Burton Law

Added: (Tue Jan 24 2012)

Pressbox (Press Release) - This is Part One of a two-part article on some of the advantages of using a revocable trust in estate planning, either instead of a will or along with a will.

What is a revocable trust? A revocable trust is a written agreement that names someone (a trustee) to manage your money and property, usually first for your benefit and then, upon the happening of an event, such as your death, for the benefit of others. As long as you are competent you are able to change or terminate the trust at any time, for any reason or for no reason. A revocable trust, as with almost all trusts, involves several parties: you as the grantor, the trustee as the person who is appointed to manage and invest your money and property, and the beneficiaries who will benefit from the trust. During your lifetime, typically you are the trustee as well as the sole beneficiary.

In sum, a revocable trust is in essence a testamentary substitute. You may draft your trust agreement to say most of the same things that you would say if you were drafting a will.

What are the advantages of a revocable trust? When we speak of the advantages of a revocable trust, we are usually talking about a revocable trust as compared to a will or as compared to dying intestate, that is, dying without a will.

Advantages of a revocable trust include the following:

1. If the trust is funded at your death, upon your death it can begin immediately to make payments to your beneficiaries, for example, support payments or college expenses.

2. In difficult family situations, there would be less chance of the validity of the trust (as opposed to a will) being contested, for several reasons: no court proceeding is required and hence there would be no ready forum for someone to appear and contest the trust, that is, at your death, the trustee is not required to commence a court proceeding; also, because there is no court proceeding, there will be no citation or other legal notice to anyone that would in effect invite objections to the validity of the trust; also, the trust will have been in existence for some time, perhaps years, prior to your death, thereby giving the trust some extra validity or at least a sense of validity.

3. At your death, the legal fees involved would be less than those involved in a probate proceeding.

4. A revocable trust will save, usually, on court filing fees and other court fees. For example, in New York the filing fee for a probate proceeding is based upon the size of the estate and, for an estate having a value of $500,000.00 or more, the filing fee is $1,250.00. But there is no court proceeding with respect to your trust, hence there are no filing fees.

In Part Two, we will discuss other advantages of using a revocable trust in estate planning, either instead of a will or along with a will. Then, in a future article, we will discuss the drawbacks and the less appealing aspects of revocable trusts, including the need to also execute at least a simple will to cover money or property that were not put into the revocable trust before you became incompetent or before your death.

Wayne Burton Law
29 WARDS LANE
ALBANY, NY 12204
518-449-3107 Ext.120
www.wayneburtonlaw.com