Probate Avoidance – Probate is the process by which title to assets owned in your name alone are transferred after your death. Probate is often very expensive and time-consuming depending on the value and type of assets in your estate. Many assets, such as life insurance and property owned in joint tenancy, do not go through probate. Placing assets in a living trust is another method by which you can avoid the expense and delays sometimes associated with probate proceedings.
Guardianship and Conservator proceeding Avoidance – Even more costly and time-consuming than probate proceedings for decedents are guardianship and conservator proceedings for people who have become incapacitated. Through a living trust, you can plan for the management of your affairs should you become incapacitated and avoid court proceedings and the court-supervised management of your assets and affairs.
Privacy – When your estate goes through probate, your will and other documents become public record. A living trust provides you with a greater degree of privacy because the trust provisions and the assets in your estate are not subject to public disclosure.
Estate Tax Savings – If the value of your estate is more than the amount excluded from federal estate tax (in 2018, $5,600,000 and if over this amount taxed at 40%), it could be subject to estate tax when you die. A trust may enable you to reduce or eliminate estate tax through the latest tax saving techniques and ensure that more of your estate goes to the people or charities that you choose.
Proper Management of Assets – A living trust may also reduce the risk of inexperienced and unskilled management of property by allowing you to select a successor trustee to act in the future. Should you die or become incapacitated, the successor trustee takes over management of assets. In addition, the trust assets can be maintained in the trust after your death instead of being distributed outright to beneficiaries who may be unable to handle the management of assets themselves due to their age or other factors.