How To Set Up A Trust in Florida

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When we think of trusts, we often think of extremely wealthy people who want a vehicle to fund their children’s and grandchildren’s inheritance. But there are actually many types of trusts and many reasons why people of all ages and financial means create them.

Trusts are not for everyone, but they do play a valuable estate-planning role in certain situations. Crucially, you don’t have to be a multimillionaire to benefit from a trust. 

In this article, you’ll learn if trusts are right for you, how to set up a trust in Florida, the different types of trusts, and why some people find it beneficial to create a trust.

What Exactly Is a Trust?

A trust is a legal arrangement that allows a person to transfer ownership of their assets to a third party. That third-party, known as the trustee, doesn’t get to spend the money on their own lavish vacation, though. They oversee investments and spending of the trust’s assets for the benefit of the trust’s chosen beneficiary (or beneficiaries). Do note that, with some types of trust, the trustee and beneficiary are the same person, but this is not always the case.

Some trusts are irrevocable, meaning once they’re created the people who set them up cannot dissolve them. Often, though, people create what’s called revocable trusts, which can be rescinded.

Years ago in South Florida, numerous retirees were told to create a revocable living trust so their heirs could avoid the probate process after the retiree passed away. But after a great deal of time and money was spent creating these trusts, many heirs discovered they still had to put the estate through probate–the court-supervised legal procedure for distributing a person’s assets after they die. 

This happened because, to be effective for this purpose, every asset the person owned before creating the trust had to be transferred into the trust (which becomes the asset owner) and every asset they bought after the trust existed needed to be purchased in the trust’s name. Many people failed to do this for some or most of their assets, so when they died with assets still in their name, a probate was still necessary.

That said, trusts can give some people control over how their money and property are distributed, both during their lifetime and after they’re gone. The person creating the trust can specify exactly how they want their assets to be handled, such as in setting up educational funds for children or providing a steady income stream for a spouse.

The Different Kinds of Trusts

When it comes to estate planning in Florida, there are several trust structures to consider:

  • Revocable Living Trust — Allows you to maintain control over the assets during your lifetime, and make changes to the trust as needed.
  • Irrevocable Trust — Cannot be altered once established, often used for tax planning or asset protection.
  • Testamentary Trust — Created through a last will and testament and takes effect only after you pass away.
  • Special Needs Trust — Designed to provide for an individual with disabilities without impacting their government benefits.
  • Pet Trust — Ensures beloved pets are cared for after you’re gone.
  • Charitable Trust — Allows you to support the causes and organizations you care about.

The specific trust that is right for you will depend on your financial situation, family structure, and specific estate planning goals. A Florida estate planning attorney can review your options and help you select the appropriate trust to meet your needs.

What Types of Assets Can You Put into a Trust?

When you set up a trust in Florida, you have the ability to transfer a wide variety of assets into the ownership of the trust. This includes:

  • Real estate (such as your primary home or investment properties)
  • Bank accounts and investment accounts
  • Stocks, bonds, and other securities
  • Business interests
  • Valuable personal property (vehicles, collectibles, etc.)

The process of officially transferring these assets into the trust is known as “funding the trust.” As mentioned above, this is an often-overlooked but crucial step. Many people make the mistake of creating a trust and forgetting to fund it, or they fund it initially but then proceed to purchase more assets in their own name. 

If you’re unsure what type of assets would be best to include in your Florida trust, consult an experienced Florida trust attorney. They can review your individual situation and help you create a customized plan that aligns with your goals.

How to Set Up a Trust in Florida

Now that you understand the basics of a trust, let’s walk through the steps of how to set up a trust in Florida. Establishing a trust may seem daunting, but with the right guidance, it can be a straightforward process.

The steps involved include:

  1. Choosing the Type of Trust. Decide which trust structure best aligns with your estate planning goals, whether that’s a revocable living trust, irrevocable trust, or another option. A Florida trust attorney can provide guidance on the pros and cons of each.
  2. Selecting a Trustee. This is the person or institution responsible for managing the assets in the trust. If you are not the trustee of your own trust, it is crucial that you select someone with extreme integrity. This is the person who will oversee and invest your assets and distribute them according to the provisions of the trust.
  3. Identifying Beneficiaries. Determine who you want to receive the assets held in the trust, such as your spouse, children, other family members, a charity or whomever..
  4. Identifying Successor Trustees. If the initial trustee passes away, a successor trustee named in the document can step into their role. 
  5. Creating the Trust Document. It’s crucial to work with an experienced attorney to draft the legal trust agreement that outlines the terms and conditions, as this document requires specific language in order to withstand legal scrutiny in court.
  6. Signing the Document. Once the document is finalized, you’ll need to sign it to make the trust official. This must take place in the presence of a notary and two witnesses who must also sign.
  7. Funding the Trust. The final part of the process involves formally transferring ownership of some or all of your assets (real estate, bank accounts, investments, etc.)–depending on the type and purpose of the trust–into the name of the trust.

Once a trust is created, it’s crucial that the documents be stored in a safe but accessible place. These documents are not recorded with the court. When people lose the document–as clients who come to me have done–major problems with their finances can ensue.

The key to determining whether you might benefit from setting up a trust in Florida is to work closely with a knowledgeable Florida trust attorney who will discuss the options with you, manage the process correctly, and, if appropriate, create a trust that meets your specific needs and goals.

Are You Looking to Set Up a Trust in Florida? Contact the LAW OFFICE OF GARY M. LANDAU, Serving Coral Springs, Parkland, Fort Lauderdale, Boca Raton, Pompano Beach, Deerfield Beach & All of South Florida

With more than 25 years of experience and countless satisfied clients, Gary M. Landau and his team are uniquely positioned to help you with your estate planning or real estate needs in South Florida. Whether you’re ready to probate a loved one’s estate or to write your own will, or if you are purchasing a home, have inherited a home, or want a closing agent to handle title insurance and all documents for your closing or refinancing, the LAW OFFICE OF GARY M. LANDAU, P.A. is ready to work with you.

Call our office at (954) 979-6566 or complete our online form today to schedule a free consultation. We work with our clients in person, over the phone, or on Zoom.

Copyright © 2024. LAW OFFICE OF GARY M. LANDAU, P.A. All rights reserved.

The information in this blog post (“post”) is provided for general informational purposes only and may not reflect the current law in your jurisdiction. 

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Coral Springs, FL 33067
(954) 979-6566

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