As you considered your estate plan, perhaps you did some research and decided that a trust might be the right fit for you and your assets. You may have heard people talk about “funding a trust”, “transferring funds to a trust” or “moving assets into the trust.” Those phrases may have you thinking of the trust as a kind of box, into which you place money or assets for future use by a beneficiary. The process of funding a trust isn’t quite that simple, but once you understand the basics, you’ll be able to determine how you want to proceed.
Transferring Title and Ownership to the Trust
Once you have signed the trust agreement, it’s time to change the title and ownership for some of your property/assets. You’ll still be able to use and make decisions about everything as usual, but the title and ownership of those assets will now fall under the domain of the trust.
For instance, let’s say you have real estate in your name. Funding a trust with real property requires a new deed reflecting the name of the Trust and transferring title/ownership to the Trust. The new deed must be executed, notarized and recorded in the County where the property is located. If the deed is not drafted and executed properly and title of your real estate is not in the name of your Trust at the time of your death, a probate proceeding may be needed. Your estate planning attorney can help you decide on wording that works for your property, your state, and your trust.
Establishing Ownership Rights of the Trust
What if you have other assets or personal property that do not have a documented title on paper? For example, imagine that a woman has a collection of jewelry and antiques that she wants to pass along to the beneficiaries named in her revocable living trust. With the help of her lawyer, she will need to create documentation that assigns ownership rights, moving those rights from her name to the name of the trust. This type of ownership assignment can apply to royalties, artwork, loans, patents, copyrights, partnership or membership interests, and rights to oil, gas, and minerals on land that you own. If you’re not sure which property you need to transfer via this method, talk to your estate planning attorney in Maryland.
Making the Trust the Beneficiary of Assets
If you have a retirement account, 401(k), pension plan, health savings account, life insurance, and other similar assets, you may want your trust to receive these funds upon your death. To do so you may need to complete a new beneficiary designation form for each asset to name the trust as the beneficiary, and the funds are then distributed according to the provisions of the trust. It is extremely important that you speak to your attorney about each of these assets and the consequences of naming your trust as the beneficiary.
Securing the Support of a Good Lawyer
Take the time to think about the property you own, your memberships and partnerships, your business endeavors, your stocks and bonds, and anything else that you want to pass on to your heirs. If you want your beneficiaries to enjoy the full benefit of their inheritance without extra hassle and stress, contact an experienced estate planning lawyer today to get the help and support you need for funding a trust.
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About Nicole K. White
After losing a close relative, Nicole witnessed the devastation, enormous expense and chaos caused by not having a simple estate plan. It is Nicole’s mission to educate parents, especially single parents, about protecting themselves, their families, minor children, and assets with comprehensive Estate Planning.
