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CALIFORNIA PROPERTY OWNERS

WHY A REVOCABLE LIVING TRUST MAY BE RIGHT FOR YOU

  • DO I NEED A REVOCABLE LIVING TRUST?
  • I CAN AVOID PROBATE?
  • TYPES OF TRUSTS
  • RPD REVOCABLE LIVING TRUST

The primary benefit of a Revocable Living Trust is to avoid probate. When you die with or without a will, your estate is normally reviewed and distributed in California Probate Court. The probate process is designed to pay your debts and taxes; and then distribute the remaining property to your heirs in an orderly fashion.


Some advantages of probate is that it provides a cut-off date for creditors’ claims and conclusively settles any inheritance disputes between beneficiaries. If you have lots of creditors, have possible lawsuits against you, or anticipate a dispute between your heirs, you may want your estate to be probated.


The disadvantages of probate are that it takes time, costs money, and is a matter of public record. Heirs normally have to wait at least 8 months to receive their inheritance if there are no problems. If complications arise, probate can take years to complete. Anyone can contest a Will during the probate process, and some unscrupulous people do it in the hope that they will get paid out of court to withdraw the case they have filed in Probate Court.


The cost of probate can be high, especially when you own real property (home or investment). Maximum attorney and executor of the court fees are based on a percentage of the estate’s value, which doesn’t subtract the value of mortgages. (See Probate Calculator for estimated cost)


Anyone can obtain a copy of a probated Will. Probate filings are public record. Predators can look up exactly how much your heirs have received and seek to take advantage of their emotional vulnerability.


Even worse, if you have real estate in more than one state, your heirs will probably face probate in multiple states, multiplying hassles and expenses.


Another reason for a Living Trust is to avoid conservatorship. If you are ever incapacitated and unable to make financial decisions for yourself, California courts may have to get involved. The court then approves if, when, and how your property is to be sold and proceeds spent. Your loved ones tend to suffer the most, from the emotional burden of your incapacity coupled with the hassle of going to court every time bills need to be paid.


HOW A LIVING TRUST WORKS

A Living Trust is a legal entity (like a corporation) that you create while you live. It survives after you die. Property transferred to the trust doesn’t have to go through probate when you die, because it belongs to the trust and not you.


To create a trust, the creator (officially called the “Grantor”) gives power to someone (the “Trustee”) to manage the property for the benefit of the beneficiary / beneficiaries. While you are alive, you are all three parties (Grantor, Trustee, and Beneficiary). A Living Trust is “revocable”- you can change it any time while you are alive and of sound mind. It becomes irrevocable only when you die or are incapacitated.


Because it is revocable and you are the Trustee, there is no separate income tax while you are alive. Simply use your existing social security number.


After your death, the Successor Trustee named by you in the trust document (REVOCABLE LIVING TRUST) distributes your property to the beneficiary (or beneficiaries -named by you in the trust). Upon completion of the process, the trust dissolves.


In the event that you are incapacitated, the Trustee does not distribute your property, but manages the trust based on your requests to pay for your care as well as all financial and medical bills.


IS THIS REVOCABLE LIVING TRUST RIGHT FOR YOU?

Is/Are the original Trustee(s) intended to be different from the Grantor(s)? This Living Trust assumes that the Grantor(s) and the original Trustee(s) are the same.


If you have children from a previous marriage, and you want to leave property to your spouse “only” for life, with the remainder to your children after your spouse dies? This kind of trust doesn’t provide for this. Contact an RPD PRO for an expanded trust version.


The language for this trust document uses “Spouse 1” and “Spouse 2” language for married couples. Please contact and RPD PRO for any clarifications of your current marriage status or special requests so we can accommodate you.


After your death, do you want to distribute gifts in installments? This trust distributes gifts all at once. For special clause or trust instructions regarding distribute gifts in installments, contact and RPD PRO for further details.


Do you have a disabled child or other beneficiary who might qualify for Government benefits? This trust doesn’t provide directive for a “special needs trust”. For special clause or trust instructions for special needs trust, contact and RPD PRO for further details.


Do you want to form a trust for a pet instead of just leaving the pet to someone to take care of? This trust does not cover “pet “directives. For special clause or trust instructions regarding your pet, contact and RPD PRO for further details.

WHAT OUR REVOCABLE LIVING TRUST DOES…IT WILL “TRUST” YOUR PROPERTY

A REVOCABLE LIVING TRUST from Real Property Docs is tailored specifically for real & personal property.


Your California home, investment or vacation property, and personal property such as bank accounts, stocks, and jewelry can simply be transferred into your living trust, which may avoid the costly pitfalls of California Probate.


After naming a Successor Trustee, this REVOCABLE LIVING TRUST will hold your property with directive to manage your assets in time of incapacitation or distribute real and personal property to the Beneficiary(s) named in the trust at the time of death.


While living and of sound mind, you can revoke or amend your trust at any time.


This REVOCABLE LIVING TRUST is for California property owners who are single, married or seniors with property under $2,000,000, all without complex situations regarding their assets or past family circumstances. (See Examples in RLT Section)


With Real Property Docs and in seven (7) easy steps, you can complete your REVOCABLE LIVING TRUST and “Trust” your property.

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