The Benefits of a Living Trust in Nevada
When people think of estate planning, they usually think about wills. A will is an essential start part of estate planning because it directs how your property passes after your gone. However, with a will alone, there is a probate process, and courts are involved. But a will is only one tool in the estate planning process.
In Las Vegas and throughout the country, a “living trust” has become a popular estate planning tool because it allows an estate to circumvent Nevada’s complex probate process. Whether you are old or young, wealthy or not, a living trust may benefit you and your loved ones.
Living Trust Basics
A living trust is a document that provides for the administration and distribution of your assets during your lifetime and upon your death. In order for the trust to be effective, you must transfer your assets to the living trust during your lifetime. You can include assets like investments, banks accounts, real estate, and personal property in the living trust. Some of the primary benefits of a living trust include that you can direct how your assets will be administered during your incapacity and where your assets pass upon death, without having your family go through a complex probate process. Plus, living trusts are revocable, which means that you can cancel or change them at any time, and as many times as you desire during your lifetime.
When you create a living trust, you remain in complete control of your assets. You can name yourself as the trustee and move assets in and out of the trust as you please. Unlike a will, a living trust enables you to appoint a “successor trustee.” That person is your representative upon death and distributes your assets to the beneficiaries named in the trust, according to your instruction.
As mentioned above, a living trust also becomes effective should you become incapacitated. The named successor trustee would act according to your directives as set forth in the trust. The successor trustee will handle financial issues and manage properties and business assets on your behalf. And, unlike a will, it can be done quickly, without any court involvement.
Advantages of a Living Trust
- Avoid Nevada’s Complex Probate Process
This ability to sidestep the courts is one of the more significant benefits of a living trust. Probate is a court-supervised process to prove the will valid, distribute assets accordingly, and settle the affairs of a deceased’s estate. Generally speaking, Nevada requires a probate when a person dies owning more than $25,000 in assets or owns real estate.
All assets that were owned by the deceased (and do not otherwise ot pass pursuant to the terms of a contract (beneficiary designation or a payable on death designation) or by operation of law to a joint owner of the asset) must go through probate. Probate can be costly, and the bigger the estate, the higher the costs and the longer the probate proceedings can take. For a routine probate proceeding, the minimum probate period is usually several months. However, the process is more likely to last about one year until assets are distributed.
A living trust isn’t the only way to avoid probate. There are other ways to bypass probate, but only for particular assets. For example, retirement accounts or insurance policies with named beneficiaries go directly to the beneficiary. Those wouldn’t be included in a trust.
- Ensures privacy
Another benefit of a living trust is its privacy. When a person dies, their will becomes a public document, open for everyone to see, and in some cases, contest. The probate process itself is open to the public, so anyone can learn the details of your estate.
A living trust is a private document. Unlike a will, a trust doesn’t become part of the public record. People aren’t privy to the trust, and unless they are named as trustees or beneficiaries, they’ll be unable to determine how the trust assets are distributed and to whom. Thus, in most cases, a living trust may be harder to challenge.
A living trust isn’t about how many assets you have. It’s about having the security that your assets will be distributed according to your wishes. When properly drafted and properly funded, a living trust provides the greatest assurance because it is provides a clear, flexible, private plan to deal with all of your assets. A living trust can smoothen the process of administering and transferring assets to your beneficiaries. Working with an attorney to establish a living trust can also prevent you from passing assets to unintended beneficiaries, and from unintentionally disinheriting someone as a beneficiary.
To take advantage of a living trust and its benefits, you have to fund it with assets. In most cases, it means retitling property and accounts into the trust. Having an experienced Las Vegas estate planning attorney will help you to avoid the potential pitfalls involved in creating a living trust. Our trust and estate attorneys at Lee Kiefer & Park understand the ins and outs of the process. You can schedule a free, confidential consultation at 702-333-1711.
Attorney Kennedy Lee practices in all aspects of trust and estate law. He views all legal issues from multiple angles (e.g. from litigation to administration point of view) to provide a higher quality of service to our client.