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Individuals who want to plan their estates while retaining advanced control over the disposition of their assets can create living trust structures. Also known as inter vivos trusts, these estate planning tools accommodate those who want to manage their assets before their deaths. While the specifics vary from state to state, most people simply create formal declarations attesting to the nature of the trusts and the assets they hold. The assets to be contributed may be listed in the same document or an attached schedule.
Trust structures involve an official transfer of property from the original owner to the trust itself. Because inter vivos trusts are self-directed, grantors still preserve their rights to take advantage of the property, but they need to maintain separate income tax information even if they make themselves the trustees.
Living trusts are usually revocable, which makes them readily adaptable to the grantor’s ongoing needs. Amendments can be made at any time before the grantor’s death, and the trusts are executed according to their instructions. Unlike drafting or modifying wills and other documents, managing a living trust is generally free of formalities or the need for witnesses. In some cases, however, the type of property placed in a trust will make it subject to state requirements on documenting its contents in a public record.
Although living trusts appeal to many Florida residents because of their simplicity, the specific terms and assets involved in a trust structure can impact how the law applies. Some assets are harder to transfer than others, and the language used to protect them plays a major role in the efficacy of a trust. People who want to plan for the future may find it helpful to seek legal clarification about their different options.