Trusts

Trusts that are set up during a person’s lifetime are called intervivos trusts, or living trusts. Most intervivos trusts are revocable trusts, in which the client acts as trustee and maintains complete control over his or her assets. If a client sets up an intervivos trust and transfers assets into the trust before death, those assets will not pass under the client’s Will and will not be subject to the automatic jurisdiction of the Probate Court. Many people consider trusts to be an attractive estate planning option because they do not wish their assets to pass through probate and be a matter of public record.

It is especially important that a living trust is funded during your lifetime. Oftentimes, individuals draft a will that transfers their assets into a trust when they die (called a “testamentary trust”). While these testamentary trusts may help avoid outright gifts to minor children and can provide ongoing support for a surviving spouse, they are subject to ongoing Probate Court supervision, with the accompanying expense and publicity just like wills. 

Although a funded living trust  may avoid probate, it may still be subject to federal estate taxes.