The person who forms a trust is called the “trustor.” As the trustor of a family trust, you can manage a trust that benefits those closest to you. It is not expensive to form a family trust. According to LegalHelpMate.com, “Lawyers commonly charge upwards of $1,500 to draw up a simple trust.” Forming a trust is a moderately easy task; however, you must consider who will benefit from the trust and be ready to fund it with property.
Draft a trust deed. Identify the person who will take over the trust if you die or become incapacitated. Known as the "successor trustee," this person will manage and distribute property according to the trust’s instructions. Name the “beneficiaries” of the trust, which are the relatives, children and charitable organizations you have decided should receive the property in the trust.
Sign the trust deed in front of a notary. It is not necessary to submit a trust deed to a probate court or to make the terms of the trust deed public.
Fund the trust. Before you can transfer real estate and heirloom property into the trust, you must hire an appraiser to set value upon each asset. The trust is not executable until it is funded with property.
Re-title assets. Fill out an Agreement for Sale and Purchase, which re-titles your assets, including bank accounts and property, into the family trust.
Grant your family trust the legal right to buy and maintain ownership of your assets without payment. Fill out a Deed of Acknowledgment of Debt to postpone payment for your assets until a later date, which is not needed at the time of signing. Forgive the debt over time in accordance with your state’s gift-giving laws.
Estate planning allows you to determine how your assets are distributed after your death.
- Estate planning allows you to determine how your assets are distributed after your death.
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