Posts

How to Revoke a Revocable Trust

How to Revoke a Revocable Trust

Maybe you set up your revocable trust as a married couple before you got divorced. Perhaps you’ve decided to change who the successor trustee will be. Or maybe you’ve decided it’s too much work to keep putting newly acquired assets into the revocable trust (also called a living trust).

Whatever your reason, if you decide to revoke the revocable trust, it is possible (which is why it’s named as it is).

To do that, first, see if inside the trust itself is a procedure for how to dissolve it. If not, you’ll need to follow these basic steps:

  1. Remove all of your assets from the revocable trust. This includes having your attorney change the title of your real estate and transferring ownership of other assets from the trust back into your name.
  2. Have your attorney draft a “dissolution document,” which must be signed and notarized and have two witnesses. As with the original trust documents when they were created, this document must be stored carefully, since in most cases it is not filed with the court.
  3. Draft a new will or create a new trust. Now that you don’t have that trust ensuring the distribution of your assets, you’ll need to draft a new will. Alternatively, if you want to create another trust with different assets or successor trustees than your former trust, that should be done right away.

Having the Law Offices of Gary M. Landau by your side during each step in a real estate or probate matter helps insure that the process goes as smoothly as possible. For more information, call 954-979-6566 or email for a free consultation.

The Various Ways You Can Take Title In A Real Estate Transaction

Wondering how you might take title when you buy your new home? If you’re single or divorced, you’d obviously have sole ownership. But if you’re married or in a relationship, or have a living trust, there are several options. The exact language varies by state although the concepts are similar. In Florida, here are the most common ways your deed might read:

Taking Title In A Real Estate Transaction

Tenants in common. This is the legal entity the courts assume if the deed is otherwise silent. This means if there are two people taking ownership and one dies, that person’s half goes to his probate heirs, not directly to the other owner. If there are three owners, each actually owns a third, four owners a quarter, and the like.

Joint tenants with rights of survivorship. In the case of a death, this deed give the surviving owner the entire property. So if there’s a non-married couple with kids from prior relationships and one passes away, his or her share automatically goes to the remaining partner. As the new sole owner, that person can later choose to leave the home to anyone they wish– excluding their late partner’s children if they desire. (This is the reason couples on second marriages often choose tenants in common for their deeds together.)

Tenancy by the entireties. This can only be used for people who are legally married. Similar to joint tenants with rights of survivorship, each party owns 100%, so if one passes away the property automatically goes to the other. Unlike with JTWROS, however, if a judgment is entered in court against only one of the owners, it cannot become a lien on the property.

Trust. A trust can also take title to a property. This is typically recorded on the deed as “Jane Smith, Trustee of the Jane Smith Trust dated August 1, 2016.” This can be useful for an older person whose home is their main asset, because they can avoid probate; the successor trustee steps in as the owner upon the person’s death. This has to be done carefully, though, because I have seen people have problems selling their home in a trust because no trust was in legal effect when the property was purchased–or worse, the trust (a document drafted by a lawyer and not filed with the court) cannot be found.

If you’re looking to buy or sell a home, Contact us by email or call the Law Office of Gary Landau at 954-979-6566 for a FREE consultation. Gary Landau personally returns all calls to him.

The Pros and Cons of a Revocable Living Trust

Sometimes clients come to an attorney wanting to create a Revocable Living Trust. What this means is that a legal entity, or trust, is created to house your assets for your use during your lifetime (hence the living), which you can cancel or change at any time (hence the revocable).

Pros and Cons

There are good reasons you may want to do this, and others why it’s not the best way to go.

The Pros:

  • Trust assets don’t go through probate. After the trustee passes away, the successor trustee (named in the original document) steps right in and becomes the new trustee. This means that all assets in the trust pass to this person (or people) without needing to go through probate.
  • There’s little time delay. Because the successor trustee has access to trust assets right away, heirs don’t have to wait until these items go through probate before they dispose of them, such as selling a home.
  • It affords more privacy. Unlike a will, a trust is not filed with the court, so the details of your trust cannot be accessed by the public.
  • You can change your mind. If you decide at any time that you want to move your assets out of the trust and back into your name, you can do so.

The Cons:

  • There are costs involved. A trust is a complex legal document that is best created by an attorney.
  • You have to “fund” a trust. All of your assets must be moved individually into the trust. This is a time-consuming process, as you need to contact your banks, investment and insurance companies, and other asset-holders to change the ownership of each account. You also need new deeds to move any real estate into the trust.
  • You still need a will—and maybe a probate. Assets falling outside the trust have to be probated by the court. I see this often in my practice, where home deeds or bank accounts were never moved into the trust, perhaps because they were acquired years after the trust was formed.
  • You have to pay taxes. Despite what many people erroneously believe, income earned by the trust during the trustee’s lifetime is attributed to the person, requiring the payment of income tax. And if the value of the trust at the time of the trustee’s death reaches the IRS threshold for estate taxes, the tax must be paid.
  • If a trust is lost, there is no way to retrieve it. Since this document is not filed with the court, the only version is the one you hang onto. A client recently came to me claiming she is the successor trustee, but since the trust was drafted decades ago and couldn’t be found, we had difficulty proving she was entitled to the inheritance.

For more information about whether a trust is right for you, contact the Law Offices of Gary M. Landau, P.A. at 954-979-6566 for a free consultation.

 

 

A Spouse’s Rights Even If a Will Leaves You Nothing

Spouse RightsYou may think that if you’ve been written out of your spouse’s will, you won’t inherit a thing, but that may not be true. Ditto if your partner drafted their will before you were married. That’s because Florida law protects spouses from total disinheritance, regardless of what a will says.

A husband or wife, for instance, has rights regarding your primary, or “homesteaded,” home. If your spouse has no children, the home would automatically pass to you. Even if he or she has kids from a prior marriage and left the house to them, you still have the legal option to live in the house for the rest of your life (known as a life estate), or to immediately become a 50 percent owner of the home.

Beyond your house, a spouse is also entitled to some of the deceased person’s money. In general, the law gives you 30 percent of your late spouse’s assets, including assets that fall outside the probate, such as property in a trust in their name. This also holds if the person wrote their will before they married you and left all their stuff to a parent or someone else.

The law also provides for a disinherited spouse to receive some money, called a family allowance, from the estate’s assets even before the probate is completed and all the money is distributed.

Of course, all of these rights may have been waived by the spouse if he or she signed a valid premarital or postmarital agreement.

Don’t try to understand these complex laws yourself. If you live in South Florida and need the advice of a probate attorney, contact us at The Law Office of Gary M. Landau, P.A.