A Washington State Living Trust: Is It Right For You? Oh, and what is that? - Porto Legal Group (2023)

You've probably heard of a "living trust" or "revocable trust," but you may not know exactly what it is. The concept is not suitable for everyday use, but it is much easier than you might think. A living trust is simply an agreement, between you, if you are an individual, or with your spouse or partner. A living trust is only one part, albeit an important part, of aestate planning strategy, designed to ensure your future and that of your loved ones.

What is a Washington State Living Fund?

Creating an estate plan may involve establishing a living trust. A Washington State Living Trust is a document created by a trustee or grantor (such as YOU). You can create a revocable or irrevocable trust in Washington state, although this article focuses more on revocable trusts. The settlor transfers ownership of his assets to the fund. For example, the dependency would fall on the deed of your home. In a revocable living trust, the settlor is the living beneficiary and his family or other close associates are the conditional beneficiaries upon his death. The trust is administered by a trustee for the benefit of the designated beneficiaries.

Revocable Living Funds

In a Washington state revocable trust, the settlor can make changes to their trust at any time during their lifetime. This includes adding or removing property, changing beneficiary designations, or even dissolving the trust if you choose. A living trust is designed to hold your assets while you, the trustee, use and control them. In many cases, the settlor acts as trustee of a revocable trust for life, provided they have legal capacity.

What are the benefits of a Washington State Revocable Trust?

A living trust offers numerous advantages as a trustee. While a trust may seem complex at first, once put in place, it acts as a secure vehicle that keeps all your property and assets in one place.

flexibility and control

One of the main benefits of owning a Washington State life fund is the flexibility that the instrument offers while you are alive. During your lifetime, a revocable living trust gives you full control over your wealth and property. Furthermore, you retain control of his assets even after his death. The successor trustee of your trust will carry out your wishes in accordance with your trust.

distributions

As the settlor of your trust, you can choose how you will make distributions over time. For example, the trust may hold property for the benefit of a young child until they reach puberty, or even until the child reaches middle age and beyond! You also have the freedom to make incremental distributions to recipients so they don't receive a massive distribution all at once. For example, you may choose to give your children a direct distribution at ages 30, 35, and 40 to ensure they use their inheritance wisely instead of wasting it.

avoid discount

While Washington state's probate administration works better than in other states, a properly funded living trust also avoids probate administration. Inventory is often expensive and can take months. A court oversees all distribution of your property. As a result, assets are distributed only after the probate process is complete, which takes at least four months in Washington state. While it's not terribly stressful in Washington, inventory certainly isn't a fun or fast-paced experience.

privacy

One of the main benefits of trusts is the privacy they provide. The terms of your trust, the beneficiaries and the properties within your trust are never legally required to be disclosed. Probate, on the other hand, requires a will to be made public, including any distributions that go to your heirs along with their names. Many people prefer to live confident precisely because of this!

Security

A living trust also provides protection if you later lose capacity. In that case, your dependents would have to go to court without a fund (or power of attorney) and file for guardianship on your behalf to manage your finances and/or medical decisions. But if all of your assets and property are held in your living trust, your designated trustee can manage your assets and guardianship is not required.

What are the disadvantages of a living trust in Washington state?

While living trusts offer many benefits, they are not for everyone. We always carefully go through the ins and outs of the Living Trust with each individual client to determine if it is the right choice for you and your family. Choosing the right plan involves a careful and thoughtful analysis of your assets and needs. Estate planning is certainly not a one-size-fits-all situation!

Small or simple properties

In some situations, it may not be necessary to create a living trust. In Washington state, for example, a property worth less than $100,000 avoids the probate test entirely. In this situation, it is probably not worth the expense of forming a trust.

Similarly, many estates are "simple" in the sense that all assets can be transferred to adult beneficiaries through beneficiary designations. In these cases, the expense and hassle of creating a living trust simply doesn't make sense.

A Living Trust Requires Action

Creating a Washington Living Trust requires an additional step: you must "fund" the trust in order for it to function as intended. To protect your property from probate courts, you must transfer all of your assets to the trust by transferring title to the name of the trust. Not completing a full property inventory is a common mistake - a mistake our firm avoids by producing a robust asset chart with detailed instructions for each client!

The transfer process requires time and a bit of knowledge. Among other changes, new deeds must be recorded for your property, forms must be completed to update all accounts, and beneficiary designations and trust assignments must be made. Unlike many other companies, our highly-skilled team will guide you through each of these changes. We do not leave our clients alone! We make sure your trust is fully funded when you leave our office. We also offer a free review every three years and ongoing support when you need it!

creditor claims

In succession proceedings, the term for the creditor to file a claim against his estate is four months after notification to the testator. After this claim period has elapsed, the creditor will no longer be able to claim the inheritance. However, in a fiduciary relationship, creditors retain the right to demand payment of any debt from the estate until the statute of limitations on the debt expires. Generally, the successor trustee pays most debts, such as outstanding bills and taxes, of your trust before distributing the funds to the beneficiaries.

Why hire a lawyer?

There are many factors that affect whether a living fund is right for you, including different tax planning and distribution requirements that are different for each client. The old adage "You don't know what you don't know" has never been more true than with a living trust, so it is imperative to seek legal advice from an experienced estate planning attorney. Contact us and we'll do a detailed appraisal of your property and help you create a plan that fully and accurately reflects your wishes. We pride ourselves on building long lasting and long lasting relationships with our clients.Contact our officefor a free 15-minute consultation to discuss whether a living trust is right for you.