Living Trust
The benefits of a Living Trust
Living Trusts generally provide 6 main benefits when created with other proper documents.
Avoiding Probate
Minimizing Federal Estate Taxes
Avoiding conservatorship in the event of incapacity by providing for management of bills/assets during incapacity
Providing privacy
Protecting your family
Controlling final distribution of your assets
The difference between Simple Wills and Trusts:
A simple will is merely a set of instructions to the Probate Court as how to distribute a decedent's assets. A Trust on the other hand is used to AVOID the probate court proceedings. A Trust is usually prepared with a "POUR-OVER" WILL that instructs the executor to POUR any assets which may be left out of the Trust, into the trust upon death.
Why Should I Avoid Probate?
Probate is a court procedure whereby the Probate court authorizes transfer of property to the decedent's heirs and loved ones upon death. Probate, like any other court procedings can be very costly to the estate and quite time consuming. For example, Probate in Los Angeles County can take anywhere from one to four years, depending on the complexity of the Estate.
Cost of probate:
By transferring your assets now into a Living Trust you will save your loved ones thousands of dollars in probate fees later...
Fees that are paid BEFORE your heirs receive their inheritance. They consist of court costs, appraisal fees, bond premiums, executor's and attorney's fees... an average of 6% to 10% of the Gross value of your estate can be saved. With your assets in a Living Trust, your family can avoid these high probate fees.
| Gross Estate | Probate Fees |
|---|---|
| $150,000 | $11,000 |
| $300,000 | $18,000 |
| $500,000 | $26,000 |
| $1,000,000 | $46,000 |
Other problems with probate:
Probate files are public documents. This means that anyone can find out what assets are in the estate, what debts are owed at the time of death, and who received what and how much.
Assets are frozen and cannot be sold without court approval.
Wills can be contested by anyone.
Cost of a SIMPLE TRUST PLAN at our office:
| Gross Estate Value | General Cost of a Simple Trust Plan* |
|---|---|
| Under $700,000 | $850.00 Single |
| $950.00 Married | |
| $700,000 to $1,500,000 | $1,100.00 Single and Married |
| $1,500,000 and above | Minimum $1,200 and quoted individually depending on the nature of the estate assets |
* Above General rates are subject to change annually on January 1 of every year. Complicated Trust matters will be quoted individually.
** Fees above do not include fees charged by the County Recorder and messenger service. Additional charges for transfer of real estate ($125.00 per deed.)