Last Will and Testament Articles >> Advantages of a Revocable Living Trust

Advantages of a
Revocable Living Trust

A living trust has many advantages when it comes to estate planning, but the advantages of a revocable living trust are even greater. An revocable living trust not only allows you to avoid lengthy and expensive probate, but you’re able to make revisions to your living trust as often as you’d like as well as convert the fund to an irrevocable living trust down the road offering yourself even more tax savings.

Advantages of a Revocable Living Trust

In addition to the advantages of all living trusts, a revocable living trust has benefits unique to its structure. A revocable living trust can be changed, updated and completely revoked at anytime as well as being made into an irrevocable trust at some time in the future.

Flexibility

Because you can modify a revocable living trust however you see fit, it has greater flexibility than many other living trusts. To make a living trust revocable, you must include the terms in the initial paperwork, but once your trust is designated as revocable, you can make any additions, subtractions or even terminate your living trust as you see fit.

Revocable living trusts are simple to set up, especially using our easy-to-understand information packets and forms available for download, and modifying your revocable living trust is a simple as making changes to the document and updating the records. Each living trust packet includes the steps necessary to create or change a revocable living trust in your state.

Tax Benefits

A revocable living trust has some tax benefits if you create what’s called an AB trust which gives married couples double protection from estate taxes, but if you make your revocable living trust irrevocable some time in the future you could have more significant tax benefits.

Irrevocable living trusts might not taxed as your property and might not be subject to any estate taxes if you don’t use or receive income from the property owned by the trust. You can use your revocable living trust however you please, and as you find your tax position growing as you age, using the flexibility of the fund might make sense to protect your estate and dependents as much as possible once you reach a certain point.

No Need for Probate

As with any living trust, there is no need for probate as there would be with a will. Probate checks to see if wills are valid and then collects and catalogs the estate before taking out applicable taxes and the standard probate fees which can reduce an estate by thousands of dollars.

By setting up a simple revocable living trust, all assets within that trust are protected from probate. By skipping the months or years most probate courts take to process an estate, your beneficiaries receive more from your estate and the distribution of your living trust is much simpler and faster than standard estate proceedings.

Convenience

A revocable living trust is also extremely convenient for most families. A living trust is easy to create and funding a living trust is not more complicated than signing a few papers. Once the fund is set up, your assets are organized in a way that you control without any interference from the legal system.

When you pass, your successor trustee can distribute your trust however you specified without waiting on the court to give the okay, and more of your assets reach their intended destination. Finally, your trust remains private as it is never filed with the court unless it is contested. And should your revocable living trust be contested, it is extremely unlikely the trust will be found unsound. Revocable living trusts are absolutely among the best ways to protect and manage your assets.