Front Page
Commentary
Editorial
Feature
Health
Perspective
Legal
Real Estate
Africa News
Community
Arts & Entertainment

About Us
Advertising Info
Subscribe
Survey
Chat Room
Bulletin Board
Guest Book


Search

Past Issues

Current Weather
7-day Forecast
Traffic Map

‘Living trust’ can be passed on to your beneficiaries without probate

A trust is generally an agreement where one person holds and manages property for another.

If you create it while you are alive, it is called a “living trust” and is a vehicle for passing along property (after you are gone) to your beneficiaries without the lengthy process of probate.

To create a living trust, ask your lawyer to prepare a trust agreement that names the trustees -one or more responsible individuals or a bank or trust company - as well as your beneficiaries. The agreement, which defmes the trustee’s rights and duties, usually states that if you are disabled, a trustee may use the income and principal from the trust to pay your bills.

Upon your death, the trust property is transferred to your beneficiaries without probate. A trustee, however, may also continue to manage the trust property for the beneficiaries if they are minors, disabled or have special needs.

The trust agreement usually states that you retain the power to amend or revoke it whenever you wish. Because of this feature, these trusts are sometimes called “revocable trusts” or “revocable living trusts.”

One of the great advantages of a living trust is that it provides for comprehensive disability planning. If you become incapacitated, a designated trustee will take over the control and maintenance of the trust. The trustee invests the trust funds and uses them for your benefit, according to the instructions ,in the trust. No other disability plan provides these complete instructions. Though trust*es cannot use the assets for their own benefit, they may receive compensation if it is allowed under the terms of the trust.

One of the disadvantages is that it must be funded to be effective. The trust controls only the assets which are registered in its ruune. Every time you acquire or exchange assets, you must make sure that they are registered in the name of the trust. Any assets which have not been transferred have to pass through probate, thereby negating one of the primary advantages of a living trust.

Some attorneys prefer to leave the trust unfunded until a triggering event such as a major decline in health. This arrangement avoids the headaches, paperwork and expense of funding the trust when it is created. An unfunded trust does not avoid probate but has all the other advantages of a funded trust so probate itself can be a simple process. Unfunded trusts are also private. For further information about law-related issues, contact an Illinois State Bar Association member-lawyer in your area or visit www.illinoislawyerfinder.com.

Listen to The Journalist's Soldiers of Fortune CD