What Types Of Trusts Can I Create With An Estate Planning Lawyer?
An essential part of estate planning for any high asset individual, or for anyone who has a child or another dependent with special needs, is creating a trust. Yet trusts certainly are for more than just wealthy individuals. While they can allow high net worth people in the Tampa area to seek tax protection or to avoid probate, trusts can also allow individuals to ensure that a loved one has access to assets if and when they need them. Since trusts do not go through the probate process, they also allow people to keep their financial and family affairs more private. To be sure, trusts—unlike wills—do not become part of the public record in Florida.
The Florida Trust Code (Chapter 736 of the Florida Statutes) governs trusts in Tampa and throughout the state. We will go through some of the different types of trusts that are available to Florida residents and will explain the ways in which they may be helpful or useful for your particular set of circumstances.
Revocable Trusts or Revocable Living Trusts
Revocable trusts often are known as living trusts, or revocable living trusts. This is a trust that is created during your lifetime, and then any assets in the trust will be distributed to beneficiaries upon your death. This type of trust often is preferable because, as the name suggests, the person who makes it can amend it or cancel it (or portions of it) at any point during his or her lifetime. Florida law also clarifies that a revocable trust not only is one that the person who makes it can revoke, but that the person who makes it can do so without the consent of the beneficiaries to it.
With a revocable trust, the person who makes the trust remains the owner of the assets until his or her death. As such, during your lifetime, you will continue to pay taxes on the assets. Like other trusts, putting your assets into a revocable trust may mean that your beneficiaries will not need to go through the probate process upon your death.
Irrevocable Trusts, or Irrevocable Living Trusts
Unlike assets in a revocable trust, as soon as you place assets into an irrevocable trust, those assets no longer are you. You do not have control over the assets, and if you want to amend or cancel any of the terms of the trust, you will need the permission of the beneficiaries in order to do so. In most cases, parties who want to avoid probate will choose to create an irrevocable trust.
This is also a type of living trust since you create it during your lifetime.
Testamentary trusts are created upon the death of the person who makes the trust. It often is created through instructions in a person’s will, and it takes effect once the deceased passes away. However, testamentary trusts need not automatically mean that the beneficiary takes possession. You can create a testamentary trust so that you can leave assets to a particular person or people at a particular point in time.
To be clear, a testamentary trust does not allow you to avoid probate. Since testamentary trusts typically result from instructions in a person’s will, probate needs to happen in order for the testamentary trust to be created.
Learn More from a Tampa Estate Planning Lawyer
Do you have questions about creating a trust or amending a trust that you have already established? You should discuss your questions and concerns with an experienced Tampa estate planning attorney. Contact Bubley & Bubley, P.A. to learn more about the wills and trusts services we provide to clients in Florida.