There is no trust just a will. Because there's no trust in Brooklyn NY it goes to probate court.
Why/When would you need a trust over a will
- Thread starter raaizin
- Start date
While it ain't cheap, it feels great to have your affairs in order. Ya never know.
In fact, I need to modify my trust. Sheesh.
In fact, I need to modify my trust. Sheesh.
I'm in NY. We put my parents (mom's) house in a trust after my dad passed on advice of elder care attorney and Medicare specialist. They said the same thing with the probate issues especially from Covid. Probates that were taking 6 months went to 2+ years because of court backlog.
Here was an actual scenario he had. Grandma passed with a will but extended family that wasn't listed, house, some other assets but farther away from kids jobs etc. The kids could not afford the mortgage and tax payments on grandma's house. They couldn't sell it until it cleared probate. They couldn't move in or rent it. They lost the house to foreclosure and had to pay penalties when all was done.
With the trusts that were set up prior it passed straight through right away.
We did mom's in an irrevocable trust which after the 5 year look back also kept it away from Medicaid if she needed to go to nursing home/assisted living. There is some serious minimal assets allowed for the elderly if they go to a facility.
All families and situations are different. You can only hope you raised your kids that they won't go crazy fighting over the money and will take care of you with what you have if needed. When mine and wife's will were made we also setup a 2 trusts in the kids names. Any assets payouts from insurance, retirement funds etc get split 50/50. Lawyer gave us the example with NOT having their future/potential spouses on them. If they wind up with an irresponsible spending/debt person or get divorced, they could take a large portion. Not on it, my kids can can pull money from it to be used for joint things if they want but then that's gone as mixed assets. The balance stays in the trust untouchable by spouses/creditors and can pass to their kids if they have any.
Here was an actual scenario he had. Grandma passed with a will but extended family that wasn't listed, house, some other assets but farther away from kids jobs etc. The kids could not afford the mortgage and tax payments on grandma's house. They couldn't sell it until it cleared probate. They couldn't move in or rent it. They lost the house to foreclosure and had to pay penalties when all was done.
With the trusts that were set up prior it passed straight through right away.
We did mom's in an irrevocable trust which after the 5 year look back also kept it away from Medicaid if she needed to go to nursing home/assisted living. There is some serious minimal assets allowed for the elderly if they go to a facility.
All families and situations are different. You can only hope you raised your kids that they won't go crazy fighting over the money and will take care of you with what you have if needed. When mine and wife's will were made we also setup a 2 trusts in the kids names. Any assets payouts from insurance, retirement funds etc get split 50/50. Lawyer gave us the example with NOT having their future/potential spouses on them. If they wind up with an irresponsible spending/debt person or get divorced, they could take a large portion. Not on it, my kids can can pull money from it to be used for joint things if they want but then that's gone as mixed assets. The balance stays in the trust untouchable by spouses/creditors and can pass to their kids if they have any.
Over 80% of my assets are liquid in brokerage and IRA accounts. These have named beneficiaries with percentages, which bypasses probate.
The house is in my wife's name and she wants me to be able to stay in it should she die first, and then have it pass to her son. At the advice of our attorney we accomplished this through a Revocable Transfer on Death Deed for $250 which is like naming beneficiaries but for real estate, and also bypasses probate. So the deed transfers to me if she dies first, and then to her son when I die.
Vehicles are in both names, and the bank account also with rights of survivorship, but I will likely set up a simple will to cover the art collection and other personal property, although these will automatically go to my wife.
The house is in my wife's name and she wants me to be able to stay in it should she die first, and then have it pass to her son. At the advice of our attorney we accomplished this through a Revocable Transfer on Death Deed for $250 which is like naming beneficiaries but for real estate, and also bypasses probate. So the deed transfers to me if she dies first, and then to her son when I die.
Vehicles are in both names, and the bank account also with rights of survivorship, but I will likely set up a simple will to cover the art collection and other personal property, although these will automatically go to my wife.
- Joined
- Jun 26, 2022
- Messages
- 169
Think of a trust as instructions for the pay out of your esstate. Your trust goes han and hand with a will. A will will outline who gets what that can be material or financial but if you have ongoing investment monies, the trustee (person named as the representative to oversee the trust) will be the one charged with following your wishes. Examples would be in your will you can leave your house to your child and then investment income could be paid out in $XXXXX per month or year until such a time as the funds are exhausted.
Make any sense?
If you have neither, then your estate will go into probate and then a judge will decide what happens to all of your assets. The judge might decide to sell your house for example and if you own income propeties then sell those as well. That is a hassle and then adds in a whole level of taxation that I won't get into here.
TH
Make any sense?
If you have neither, then your estate will go into probate and then a judge will decide what happens to all of your assets. The judge might decide to sell your house for example and if you own income propeties then sell those as well. That is a hassle and then adds in a whole level of taxation that I won't get into here.
TH
There is a LOT of bad/false advice in this thread. Those who are not attorneys or CPAs should not be commenting. Also, many are confusing a revocable trust with a grantor trust.
I had added my father-in-law as beneficiary to all our insurance policies, 401K's. When we did the wills the lawyer also made us think about the doomsday clause of, if you/wife/kids pass and they have no kids yet where does all your money and stuff go? We picked nieces and nephews. All our beneficiary things and plans are spouse 100%, then per stirpes to kids 50% each and down the line. My parents did the same originally.
I added the FIL because he was the only one not going on vacation. My parents, my sister and family, my family all in the same metal tube that @Astro14 moves around. My FIL had instructions and access if needed on what to do with all of it after taking care of himself.
Yes; I have 3 levels of beneficiaries. That's what my lawyer recommended.
I think most of us shared our experience but also suggest seeing a professional in the legal areas for wills, trusts and any other versions. They are not in-expensive but a piece of mind that you did the best you could to prepare. Simple, online, free is a great start if you have nothing planned. Guidance for better planning costs accordingly.
Mine and wife's first will we only had one child, my son. All was written as "any future children also" I think my daughter was like 16 when we amended them and removed original care providers/guardians since we didn't even talk to them anymore.
There's bad info all over the internet. Are you a CPA or attorney?
I think like life there are some good bits and bad bits here. The question was pretty general anyway. Reading material was provided.
I am a certified public accountant. I should have said advising rather than commenting.
Cool - maybe just a quick bullet list of the trust types would help folks out.
I would prefer to leave that to an attorney. However, for estate and tax purposes, a revocable, or living, trust is the only way to go. That does not set up a trust for the irresponsible beneficiary, it only provides the that trust to be set up. Again, better that an attorney answer.
Fair enough. Well said.
I believe early on people said it varies by state, check with a trusted lawyer, etc
These can NOT be challenged in court and avoid Probate here in Florida.
Joint Tenant with Rights of Survivorship (brokerage account)
Transfer On Death / Payable On Death (for bank / checking accounts)
Beneficiaries for all retirement accounts (401K 403B, Roth / traditional IRAs, Thrift Savings, etc…)
Lady Bird Deed / Enhanced Life Estate Deed for property
OP,
Talk to an attorney in YOUR state for more info. Proper planning today is best for a civil distribution of your assets when you pass away.
I know a family that distributed approximately $5M in assets to 4 adult children (nothing to grandchildren) and everything when amicably, zero fighting between siblings, zero lawsuits trying to sue each other and zero probate.
Zero taxes paid to the ‘Big Guy’ and the 2 brothers kept the house + cash, 2 sisters got tax free cash.
The property tax on house was reassessed at current value….. not the value paid back in 1967. This house is a short bike ride from University of Miami.
I know another family that went through probate to settle parents house, luckily everything else was TOD, POD, JTWROS, beneficiary, etc… so this part was easy to distribute, again zero taxes paid.
Joint Tenant with Rights of Survivorship (brokerage account)
Transfer On Death / Payable On Death (for bank / checking accounts)
Beneficiaries for all retirement accounts (401K 403B, Roth / traditional IRAs, Thrift Savings, etc…)
Lady Bird Deed / Enhanced Life Estate Deed for property
^^^^^
I prefer all these over a Trust or Will and avoids lots of headaches for the grown children.OP,
Talk to an attorney in YOUR state for more info. Proper planning today is best for a civil distribution of your assets when you pass away.
I know a family that distributed approximately $5M in assets to 4 adult children (nothing to grandchildren) and everything when amicably, zero fighting between siblings, zero lawsuits trying to sue each other and zero probate.
Zero taxes paid to the ‘Big Guy’ and the 2 brothers kept the house + cash, 2 sisters got tax free cash.
The property tax on house was reassessed at current value….. not the value paid back in 1967. This house is a short bike ride from University of Miami.
I know another family that went through probate to settle parents house, luckily everything else was TOD, POD, JTWROS, beneficiary, etc… so this part was easy to distribute, again zero taxes paid.
Last edited:
If you have bequests to charities on your passing, arrange to make them payable on death from your IRA. Income taxes will be avoided.
I want it to be a sad day when I die. Sad for the tax collectors.
I want it to be a sad day when I die. Sad for the tax collectors.
I think for the most part ..... there's pretty good advice here . Get a Trust and not a Will .
I will is overseen by the local County Probate County unless it is a low value estate eligible for independent adminsistration. I trust is private and resolved more rapidly. Rules change by the state and I am not an attorney. When my mom passed her property was in a trust and was marketable as soon as the death certificate was available, which was a couple weeks. Probate can easily take a year or longer. Both just keep honest people honest. Nolo Press has a pretty good DIY Trust writing book/CD that is worth investigating.
Without going into detail about my experiences (boring - it's not a Perry Mason episode), I would suggest consulting an attorney in trusts or elder law to have a trust established.
It's worth the time and expense to have one's affairs in order, sooner than later.
It's worth the time and expense to have one's affairs in order, sooner than later.
Similar threads
