A Texas Overview of a Revocable Living Trust
John Wilson • March 2, 2019
Revocable Living Trusts Are "Living" Because You Make Them While You Are Alive
A living trust is a legal document created during an individual's lifetime wherein a trustee, or other designed entity, assumes a fiduciary duty to manage an individual's assets for the benefit of the eventual beneficiary. A living trust is also known as an inter-vivos trust and the duration of this living trust is determined at the time of the trust's creation. An important benefit of an inter-vivos trust is to avoid probate and the expenses associated with litigation after the individual's death. Further, establishing a revocable inter vivos trust avoids a conservatorship of your estate upon your incapacity. A conservatorship is a court-supervised proceeding in which the court appoints an individual as guardian of your assets and an incapacitated person. Out Dallas trust lawyers can assist you in creating your living trust documents. For more information on our will and trust practice, visit our Will & Trust Practice
web page.
When Does A Trust Become Effective?
A trust is effective upon creation by the grantor. A trustee manages and distributes assets through the duration of the trust, and a successor trustee continues the purposes of the trust in the event a successor ceases to be able to act for the trust either by way of incapacity, death or simply quitting the trust. A trust, unlike a will, avoids probate and therefore avoids time and expensive of a legal process. A trust does not need to be probated.
Is The Trust Process Private?
Given a trust is not subject to probate, it does not require public disclosure as wills do. Trusts are a private process.
Who Controls The Trust Process?
Unlike a will, a judge is not be involved in a trust unless its defective. This means that assets in a trust can be passed through to family members immediately and without court intervention. With that said, the grantor in a trust maintains control throughout their lifetime and until a successor trustee is appointed. A trustee, or successor trustee, controls the trust.
Must A Trust Own Assets To Be Effective?
Unlike a will, a trust must be funded for it to become effective. The trust must hold property (e.g. cash, title to land, or other assets). The trust becomes funded when the assets are properly titled and transferred after a grantor forms the trust. Trusts only go into probate when they are either lacking beneficiary or they are not funded.
What Happens To A Trust If I'm Incapacitated?
A trust can carry out trust terms and trust provisions immediately upon incapacity because it is effective during your lifetime, and the trust includes plans for contingencies and successor appointments. Simply, a trust can carry on your wishes during incapacity and beyond death.
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