Advantages of a Living Trust

You can choose when your beneficiaries will receive and how they will receive. You can leave instructions for your successor trustee as it relates to managing your estate and distributing it.

The assets in a Living Trust will go directly to your beneficiaries after your death. Your estate will have no probate attorney’s fees or court costs. There will be no delay in distributing your assets unless you requested it in your trust. Additionally a Living Trust is completely private.

If you become disabled or are unable to manage your estate, your Living Trust eliminates the need for a court controlled guardianship. The successor trustee you’ve named in your trust will step in and take over your affairs without the need of attorneys or the court.

The surviving spouse and the children from a previous marriage can all receive fair treatment as beneficiaries of your Living Trust.

Commonly Asked Questions

No. Remember, the purpose of a Revocable Living Trust is to avoid guardianship, probate, and to reduce or eliminate federal estate taxes. As the trustee, you will file your income tax return exactly the same way you filed it before the trust existed. The trust requires no new tax returns of taxes at all.

Yes, and if married, both husband and wife can act as co-trustees. People name themselves as the trustee of their Living Trust.

Yes. Your Trustees or beneficiaries can live anywhere.

Yes. Partial interest in property can go into the trust without the interests owned by others.

Yes. It is a common fear (often when married couples have children from a prior marriage) that the surviving spouse, may divert the share of the deceased spouse. Your Living Trust can be set up to make it absolutely certain that your share of the family wealth will go to your children should you die before your spouse.

Yes. Also long as you are the trustee, you can do anything you want with the trust assets. When you set up your Living Trust, you transfer ownership of all your assets from you as an individual to yourself as the trustee of your trust. You then manage the property for the benefit of yourself as the beneficiary. This means that you have absolute and complete control over all the assets in your trust. You can spend, save, invest or even gibe away the assets if your desire. There are simply no restrictions on what you can or cannot do with the assets in your Living Trust. Additionally, if for any reason you do not like the terms of the trust, you can amend it or revoke it at any time.

No. A Living Trust can help anyone who wants to protect his or her family from unnecessary probate fees, attorney’s fees, court costs, and federal estate taxes.

No. There is no reassessment by transferring your real estate into your trust if the transfer is done in a legally correct fashion. Also, there is no gift tax or documentary transfer tax. In Florida, you continue to receive your “homestead exemption” after your deed is put into your Living Trust.

No. Your Living Trust is private and does not need to be recorded.

Yes. Even if you are unmarried, widowed, or divorced, a Living Trust can eliminate the living probate and the death probate, which can potentially save your family thousands of dollars in attorney fees and court costs, not to mention the delay and aggravation. Additionally, you can still pass $5,490,000.00 totally free of the federal death tax.

Yes. A Living Trust properly prepared in Florida is valid in all 50 states.

No. Living Trusts have been used lawfully for centuries and the government really has no interest in making people go through a living probate or a death probate. They only clog up the court system. The only portion of your trust that may change is the amount of the federal estate tax deduction, which is $5,490,000.00. A properly drafted Living Trust can double the amount you can pass tax free if you are married. That means at the current $5,490,000.00 a married couple can leave $10,980,000.00 estate tax free.

The benefits of both probate avoidance and death tax reduction will only be achieved to the extent your assets are transferred into your Living Trust. This is called “funding” your Living Trust.

Look at this chart, then answer for yourself.

The preparation of your Living Trust should be done by an attorney trained in the area of tax and trust law. After all, your trust will be the document, which manages and disposes of all your hard earned wealth. Make certain you choose a law firm that is both qualified and experienced.

No. You can simply take title to new assets as trustee and they will be included in your trust. When you sell assets, you sell them as trustee and they are deleted from your trust.

Estate Taxes

No. Every person in the United Staes is given an exemption of $5,490,000.00for estate tax purposes. If when you die, your estate is $5,490,000.00 or less, no federal estate tax will be due. That sounds simple, but when the federal government values your estate, it counts everything, even the full face value of your life insurance policies. Remember, its ALL property owned- homes, IRA’s, 401k’s, life insurance, vehicles, personal property, etc. When you add it all together, it comes to $5,490,000.00 pretty quick.

Yes. Even though these estates are not subject to tax, you will probably not avoid a living probate if you become disabled or a death probate when you die; both of which are very expensive. Remember, probate and federal estate taxes have nothing to do with each other. They are separate and distinct. Estate taxes are assessed to allow you to transfer that property at death. Probate expenses relate to attorney’s fees, court costs, and administrative fees.

You have already learned that probate is an expensive and time consuming process in and of itself. In addition to that, your family may be subjected to an estate tax, which is really a nice term for a Death Tax. There are two types of Death Tax: State and Federal.

The federal government in addition to the $5,490,000.00 exemption for federal estate taxes, has exempted all transfers of assets between husband and wife. This is called Unlimited marital Deduction. Unlimited means that no matter how large your estate is, no tax is due when the first spouse dies. Is this a free ride? No. It merely postpones the tax until the second spouse dies. At that time, the entire estate will be taxed before the children or other beneficiaries receive their share.

In effect, the Unlimited Marital Deduction is almost a trick played by the federal government. By taxing the estate on the death of the surviving spouse, it allows the federal government to wait for the estate to grow to more than $5,490,000.00 and thus tax the estate at a rate of 45% on the excess over $5,490,000.00.

WARNING: The tax laws do not allow the Unlimited Marital Deduction to apply to surviving spouses who are not U.S. Citizens. Without special planning, all non-citizen spouses are limited to receiving only the personal exemption of their deceased husband or wife at the time of death. Any excess will be taxed.


You bet it does. Unlike a will, a joint tenancy or a combination of the two, a Living Trust protects you when you are alive. With a Living Trust, there will be no need for expensive “help” from the probate court, probate lawyers or guardians. A very important part of a good Living Trust is a section that includes your instructions on what has to be done in the event you become legally incompetent to handle your own affairs. The person or persons you choose to handle your affairs in that unfortunate situation are legally bound to follow your specific instructions.

No. The only time a will steps into action is upon your death. It only operates after you die and therefore has no control over you or your possessions during your lifetime.

No. In order to transfer or otherwise transact business related to property jointly owned, it is necessary for all joint tenants to approve. If one of the joint tenants is incapacitated or incompetent, everything will have to wait until the probate court approves. The probate court effectively takes the place of the incompetent joint tenant with the assistance of the named guardian until that incompetent joint tenant either recovers or dies.

It is called a Guardianship, but in reality it is a Living Probate. The word “Probate” is what most people think happens only when you die. Unfortunately, it can also happen while you are alive. If you become mentally disabled before you die, the probate court will appoint someone to take control of you and all your assets. These court appointed guardians must file strict accountings with the court to explain all money spent on your behalf. The living probate is indefinite in time and expensive. Additionally, it, like death probate, is open to the public and can therefore be a most embarrassing experience.


Yes. Properly funded, the Living Trust guarantees that your family will not have to be burdened with the cost, time, publicity and aggravation of the Probate process. All assets that have been placed in trust are out of the control of the probate court during your life and after death. To assure this, you as owners must simply transfer title of your property from your name to the name of your trust. For real estate, a new deed will be prepared. For securities and other property, other documents are prepared, which transfer property into the name of your trust. Remember, with you as the “trustee” and the “beneficiary” of your trust, nothing really changes except ownership. You will still make all of the decisions and enjoy all of the benefits and use of your hard earned assets. Additionally, you can amend or change the terms of your trust whenever and as often as you want or even revoke it entirely. Your written instructions control, and the presence of the probate court and probate lawyers, and the costs and delays associated with them, never occurs. At your death, your trustee simply follows your instructions and distributes your estate according to your wishes.

No. In fact, it is a ticket to probate, which must be used. The term “Probate” is Latin in origin and means “to prove a will”. All property owned by you and controlled by your will must go through the probate process and is controlled by the court until the judge orders the case closed.

The answer is sometimes but often it only postpones it. When a husband and wife own their asset in joint tenancy, no death probate occurs when the first spouse dies. The title passes automatically to the surviving spouse. However, when the surviving spouse dies, the entire value of those assets will have to go through probate court.

Joint tenancy ownership often leads to large expenses when parents and children own assets together. Eventually, the “fiddler” has to be paid, and can create unintended beneficiaries and often cause gift and death tax problems. For those reasons, estate planning experts agree that joint tenancy may be the poorest estate planning tool.

Yes, and the slow process of moving your estate through probate Court can be very frustrating for your family. In Florida, this complex process usually takes about a year, possibly longer if any additional issues should arise, which they often do. Even the simplest of estates take this much time because of all the steps that must be completed to the satisfaction of the court. Because the probate process takes so long, it may delay your family from receiving their inheritance during dire times when they may need it. Furthermore, the long process can be a continuing reminder of the family’s loss. During the process tensions can cause family squabbles when family members take their frustration out on each other.

Probate is very expensive. Probate fees are calculated on your estate’s gross value without deduction for liens and mortgages. This means that if you have property worth $200,000.00 but owe $150,000.00 to a bank or some other financial institution, your probate fees will be based on the full $200,000.00 and not the $50,000.00 equity interest you actually own.

Florida allows what is termed “reasonable attorney fee” for probate lawyers. Florida law says that reasonable is 3% of the gross estate plus 1/2% more if a tax return is filed plus fees for services in addition to a general probate which averages around $400 per hour in South Palm Beach County. Those reasonable fees can consume a large percentage of a small estate’s assets and a large amount of a medium or large estate. Every dollar spent that goes to pay probate coset is a dollar that does not go to the family.

Another yet often overlooked cost of probate is the loss of control. Often decisions requiring immediate action are stalled waiting for Court approval.

Yes. All probate proceedings are open to the public. Anyone can see your probate file and examine every detail of it. The file will contain an inventory of every asset you owned at death with its value. It will contain a list of all creditors and how much they are owed. It will show what the beneficiaries get and when they will get it. It should be no surprise that this information is often sold to those who use it to dupe vulnerable surviving family members into buying unnecessary or costly products and services.

Probate must be started not only in the state where you resided at death, but in every state where you owned real estate. This is called ancillary probate. Each state has probate jurisdiction of the real property located within its borders. That means that your family will have to file a separate probate in each state and hire a separate attorney in that state. Of course, this will significantly add to the already expensive process.

Death Probate is the legal process that occurs in Probate Court when the deceased’s debts and property are gathered and distributed according to a Will, or by Florida law if no Will exists. To ptut it even more simply, it is the legal process that must occur to transfer assets from the deceased to the living.

If you think about it, probate is not very difficult to understand. After you die, your assets need to be distributed, your debts need to be paid and any uncertainties need to be resolved. Because you no longer can sign checks or otherwise handle your daily affairs, the probate court takes over those duties.

Joint tenancy occurs when two or more people hold title to property and upon the death of one of the owners, that owner’s interest passes automatically to the surviving joint tenant(s). Actually, the full name for joint tenancy is Joint Tenancy With Right of Survivorship (JTWROS). Right or survivorship simply means that whoever lives the longest ends up owning the whole property.

Passing of title in joint tenancy is automatic. A joint tenant’s interest flows to the surviving joint tenant (or tenants) automatically at death. This happens even when the deceased has specifically designated in a will that someone else is to inherit that deceased’s interest in that property. Essentially if all property is held in joint tenancy, the sole beneficiary under a will may receive absolutely nothing.