By: Rachel A. Maver, Esq.

A trust is a commonly used estate planning tool that allows property to pass outside of probate to beneficiaries at times and in amounts as the grantor desires. However, execution of a trust agreement alone will not keep assets outside the jurisdiction of probate court. One of the most important steps after creation of a trust is ensuring it is properly funded, which can be accomplished by titling assets in the name of the trust or naming the trust as a beneficiary.

The beginning of the year is a great time to review trust funding as various tax documents are being received, such as Schedule K-1 and IRS Form 1099. Many clients use tax documents as a reminder of the various accounts and assets they have. Each form displays how the asset is titled, thereby providing a great opportunity to review whether the asset is titled in the name of an individual’s trust.

Do not be concerned that transferring assets into your trust will complicate your life. If your trust is revocable, the assets held in trust are treated as if you still own them personally for tax reporting and other purposes.

Below is a list of commonly held assets that individuals should review to ensure the titling or beneficiary designations match their estate planning objectives:

  • Real Property (Primary Residence, Secondary Residence, Vacation Homes, Time Shares, etc.)
  • Bank Accounts, Certificates of Deposit, Money Market Certificates, and Other Cash Equivalents
  • Stocks and Securities, Bonds, and Brokerage Accounts
  • Life Insurance Ownership and Beneficiary Designations
  • Ownership and Beneficiary Designations for Retirement Benefits (IRAs, Profit-Sharing Plans, Pension Plans, ESOP’s, 401(k) Plans, etc.)
  • Titled Tangible Personal Property (Automobiles, Boats, etc.)
  • Business Interests (Stock or LLC Ownership Interest in Private or Family Businesses)

DISCLAIMER: The information provided does not, and is not intended to constitute legal advice. All information and content is for general informational purposes only. Readers should contact an attorney to obtain advice with respect to any particular legal matter. The information presented may not reflect the most recent legal developments. The materials are not intended to create, and your receipt of them does not create, an attorney-client relationship. You should not act or refrain from acting on the basis of this article without first seeking legal advice from an attorney licensed in your state.