While a living trust may not be essential for everyone to have, it does carry several benefits for those who want a more assured approach to their estate planning. At JDKatz, your Maryland estate lawyer will walk you through the entire process, helping you understand the terms of living trusts, the benefits as they relate to you personally, and whether or not a living trust is beneficial for you and any beneficiaries you may have.
What Is A Living Trust?
A living trust is similar to a will in that it contains explicit instructions as to how your assets should be used and distributed, as well as other instructions for your dependents. However, as the name implies, a living trust is made and applicable while you are still alive, while a will is only executed after the will has entered the probate process following your death.
Types of Living Trusts
There are two types of living trusts, which have certain benefits according to your unique situation and needs.
A revocable living trust allows you to transfer any or all of your assets to the owner of the trust. As the trustee, you retain full control over these assets and their distribution until you die, at which point your trust and the assets it contains passes directly to your successor trustee.
An irrevocable living trust gives you the opportunity to pass your assets to beneficiaries during your lifetime. However, the assets in this trust are forever taken out of your control, and are no longer considered as part of your estate. This means that assets in an irrevocable trust are not subject to estate taxes in the same way that a revocable trust is.