Living Trust Timely Updates to Act Now - Tuohy Law Offices
Living Trust Timely Updates to Act Now
August 20, 2021 tlaw
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Blog, Living Trust, Living Trust

Living Trust Timely Updates to Act Now

Living Trust and estate plans are traditionally handled in the Fall Season. There isn’t anyone who hasn’t thought of taking care of this critical business. But there always seems to be something more important to do.  Hopefully, this update gives you some valuable information and an incentive.

What is a Living Trust?

A Living Trust is a signed legal document allowing you to privately pass your assets to your family, friends, or charities after your death.  It also serves to protect you in the event of incapacitation.

Some important points to know:

  • If you die or become incapacitated and have assets in your name, they are subject to Probate. These include bank accounts, investments, real estate, stocks and bonds, and minor beneficiary proceeds.
  • The Probate Court can’t handle every person’s estate. The average time to complete the Probate process is 18 months to two years.
  • A fully funded Trust completely avoids Probate and is administered privately.
  • Minor children’s assets remain in Probate until age 18, with all assets released at that age.
  • A Living Trust plan should contain Health Care and Financial Power of Attorney documents and a Pour-Over Will.

Why Do You Need a Trust?

  • To control and protect your estate, now and after your death.
  • By law, no one can sign your name. Therefore, if you acquire a disability, signing your name requires a previously executed Financial Power of Attorney. Your Financial Power of Attorney revokes by operation of law at your death.
  • With no Power of Attorney, you are subject to Guardianship and Conservatorship of your assets.
  • Accordingly, a Probate Estate must be opened if you have assets in your name after death. A judge names an Executor to administer your estate.
  • Last Will and Testaments do not avoid Probate. A Will is your wishes for who receives your property after your death.  A Will is filed in court within 30 days after your death.

How Does a Trust Avoid Probate?

  • You change the title of your assets to your Trust name. Consequently, they are not subject to Probate while you live or at your death.
  • Your Successor Trustee administers your estate privately and efficiently.
  • Notably, the process could take only weeks or as long as it takes to transfer your assets to your beneficiaries.

Does a Trust Protect My Assets?

  • A Living Trust protects your assets from the time expense and family stress of Probate.
  • A Trust does not protect against liability claims for as long as you are the Trustee. However, you have numerous ways to combine a Trust with sound asset protection strategies.
  • A Living Trust provides complete asset protection for your children/beneficiaries if they are subject to a lawsuit or divorce.

What Are the Other Advantages of a Living Trust?

  • Protects you in the event of your disability
  • Organizes lifetime management of your assets
  • Contains specific instructions for inheritance
  • Protects the wishes of the first spouse to die
  • Provides for blended families from prior marriages
  • Grandchildren included; children’s spouses excluded or included
  • Excludes estranged children or other relatives
  • It avoids the perils of joint tenancy.
  • Special Needs protections
  • Protects against loss of Medicare and SSI benefits or government reimbursement if a beneficiary acquires a disability before your death
  • Includes assets in all states and avoids multiple-state probate
  • Contains a No-Contest Clause
  • Provides creditor protection for beneficiaries with a Spendthrift Clause
  • Revocable
  • Easily amended
  • Readily adapted to the laws of another state if you move

Contact us today for further information or visit Tuohy Law Offices now.

Tom Tuohy is the founder of Tuohy Law Offices.

17W220 22nd Street  
Oakbrook Terrace, Illinois, 60181

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Tom Tuohy

This blog entry is created for information purposes. Therefore, it is not legal advice. Please do not use this blog as legal advice, which turns on specific facts, as well as laws in specific jurisdictions. No reader of this blog should act or refrain from acting based on any information included in or accessible through this blog without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the reader’s state, country or other appropriate licensing jurisdiction.