How to Fund a Trust

Establishing a trust has many benefits. Many people establish a trust so their family members can avoid the probate process after they pass away. Probate is a legal process that can be lengthy and expensive and so, many people incorporate tools into their estate plan to protect their loved ones, and their property, from it. However, when trusts are not properly funded, they cannot serve their intended purpose. Funding a trust can be tedious, but it is critical to ensure your wishes are respected.

What Does it Mean to Fund a Trust? 

To fund a trust, you must transfer property that is currently in your name to the name of the trust. For example, if you wanted to place your home into a trust, you can change the name on the deed to the name of the trust. Trusts are separate legal entities from the people who create them and so, any asset you place into the trust becomes the property of the trust and not you. This is how trusts help people avoid probate. When property does not belong to an estate, it does not have to go through the legal process.

How to Transfer Property to a Trust

You can place many different types of property into a trust. Some of the most common types of assets people place into a trust include:

• Real estate: Known as ‘real property’, real estate is one of the easiest types of assets to transfer into the name of a trust. Typically all that is necessary is a deed, but it must be prepared and recorded properly. In most cases, the deed should be recorded in the same county where the property is located.
• Businesses: A lawyer can prepare an assignment that can allow you to place your business interest into a revocable trust. If your business interest has restrictions on transfers, an attorney can also help you obtain the necessary permission to allow the assignment to the trust.
• Personal property: People place many different types of personal property into a trust. These include clothing, jewelry, silverware, china, pictures, motor vehicles, watercraft, household goods, and more.
• Bank accounts: A trust is just one way to leave a bank account to a loved one after you pass away. Every financial institution has their own process for this and although sometimes these are fairly straightforward, they can also be quite complex.
• Life insurance policies: It is possible to name a trust as the beneficiary of a life insurance policy. After you pass away, the insurance company will then pay the proceeds to the successor trustee outlined in the trust. The successor trustee then distributes the process according to the trust’s instructions.

Our Revocable Living Trust Lawyer in Tampa Can Help

Funding a trust sounds fairly simple but if not done properly, it may not provide the legal protection you had intended. At Messina Law Group, P.A., our Tampa revocable living trust lawyer can ensure your trust is executed and funded properly so you and your family are protected. Call us now at (813) 492-7798 or contact us online to schedule a consultation and to learn more about how we can help.

Source:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0736/0736.html