Ownership of Property in a Revocable Trust
A revocable trust, also known as a living trust, is a popular estate planning tool used by individuals in New York to manage their assets during their lifetime and distribute them to beneficiaries upon death. One common question that arises regarding revocable trusts is: Who owns the property placed within the trust?
Understanding Revocable Trusts
In a revocable trust, the individual who creates the trust, known as the grantor or settlor, transfers ownership of their assets to the trust. The grantor retains control over the trust and has the ability to modify, amend, or revoke it during their lifetime. The grantor may also serve as the trustee, managing the assets within the trust.
Ownership of Property
When assets are transferred into a revocable trust, they are no longer owned by the individual directly; instead, they are owned by the trust itself. However, the grantor maintains control over the assets and can continue to use them for their benefit while alive.
The trust document specifies how the assets should be managed and distributed both during the grantor’s lifetime and after their death. Typically, the grantor names themselves as the initial trustee and appoints a successor trustee to manage the trust in the event of their incapacity or death.
Benefits of Holding Property in a Revocable Trust
There are several advantages to holding property in a revocable trust:
- Probate Avoidance: Assets held in a revocable trust generally bypass the probate process, resulting in faster distribution to beneficiaries and reduced estate administration costs.
- Privacy: Unlike wills, which become public records upon probate, trusts offer greater privacy since they are not subject to court supervision or public scrutiny.
- Flexibility: Revocable trusts allow for flexibility in managing assets and can be easily modified or revoked if circumstances change.
- Asset Management: A successor trustee can step in to manage the trust assets in the event of the grantor’s incapacity, ensuring management and financial affairs continuity.
In New York, a revocable trust is a valuable estate planning tool that allows individuals to retain control over their assets while providing for efficient management and distribution upon death. By understanding the ownership structure of property held in a revocable trust, individuals can make informed decisions to protect and preserve their wealth for future generations.
At Morgan Legal Group, our experienced estate planning attorneys can assist you in creating and administering a revocable trust tailored to your unique needs and objectives. Contact us today to schedule a consultation and take control of your estate planning.