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Home / Trust Administration & Probate / Let Our Louisville Trust Attorney Help Create Your Trust

Let Our Louisville Trust Attorney Help Create Your Trust

September 13, 2017Trust Administration & Probate

Louisville trust attorney Trusts are important estate planning tools that can be used both to avoid probate, as well as to minimize estate taxes.  If you are considering creating a trust, you should first understand what a trust is.  Trusts are essentially fiduciary agreements between the trustee and the grantor, or creator, of the trust.  A fiduciary agreement basically means an agreement built on confidence.  Our Louisville trust attorney can help you create the type of trust you need.

The purpose of the trust agreement

The purpose of a trust agreement is to give the trustee the authority to hold and manage the assets of the trust on behalf of the chosen beneficiaries.  Through the provisions included, the trust agreement will provide the necessary instructions for managing and distributing those assets that have been transferred to the trust.  There are various types of trusts, each with its own specific purpose.  Still, there are three essential steps in creating a trust.

The three basics steps for creating a trust

The first step in creating a trust is drafting and executing the trust agreement.  Once the agreement is complete, then the trust must be funded with the property that you intend to include in the trust.  At that point, the trust has been successfully created.  The only thing that remains is following through with the terms of the trust.

What should be included in a trust agreement?

The trust agreement is the “who, what, and when” of the trust.  It is considered a contract which is binding on the trustee who manages the trust property. Some of the basic terms that should be considered include:

  • The identity of the trustee in charge before your death (if it is a living trust)
  • The identity of the trustee in charge if you become incapacitated
  • The identity of the trustee in charge after your death
  • The names of your beneficiaries and what they will receive
  • When the beneficiaries will receive their trust assets
  • How the assets will be distributed

How do you fund a trust?

After the trust agreement has been created, it is now time to fund the trust.  Funding simply means transferring ownership of the assets that you intend to include in the trust to the trust itself.  In other words, you may need to move bank accounts to a new account in the name of the trust, or add the trust as the beneficiary of life insurance policies or annuities.  Funding could also include creating a deed transferring real estate to the trust. If you have questions about how to fund your property, let our Louisville trust attorney help.

Fund a trust by changing title or ownership

Assets like bank accounts, non-IRA and non-401(k) investments, and brokerage accounts, stocks and bonds held in certificate form, and real estate, can be funded into a trust by simply changing the owner of the asset from the name of the grantor to the name of the trust itself.  Some financial institutions only require the name on the grantor’s account be modified.  Other financial institutions, however, might require the grantor to close the original account and open a new one in the name of the trust.

Fund a trust through assignment of ownership rights

When the trust property includes personal property of the kind that does not require a certificate of legal title (such as jewelry, artwork, or antiques), then the assets can be funded by simply assigning ownership of the property to the trust.  This would also include items like personal loans, royalties, copyrights and patents, partnership and membership interests in limited liability companies.

Why you should consult an attorney before creating a trust

There can often be many complicated issues that arise in creating a trust.  An experienced estate planning attorney would be much better suited to handle those problems properly.  Depending on the intricacy of the terms of the trust agreement, the extent and nature of the assets, and the potential complexities of the family, it could be very beneficial to have the guidance of an attorney.  Here are some special considerations that you should make when creating a trust:

  • Do any of your beneficiaries have special needs?
  • Are you trying to reduce your estate tax liability?
  • Do you have kids who are spendthrifts?
  • Do you have kids who have in-laws or spouses that you want to disinherit?

All of these issues can be addressed in your trust agreement, with the help of your Louisville trust attorney.

If you have questions regarding trusts or any other estate planning matters, please contact the experienced attorneys at the Cochrangersh Law Offices, P.S.C. for a  consultation.  You can contact us either online or by calling us at (502) 423-7023. We are here to help!

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Cochrangersh Law Offices
Cochrangersh Law Offices, P.S.C., a law firm focused mainly on estate planning and administration, as well as elder law matters such as subjection for Medicaid and veterans’ benefits.
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