Nicaud & Sunseri Law Firm, LLC
Southshore: 504-662-9596
Northshore: 985-218-0494

Making The Complex Understandable

How does a revocable living trust work?

One of the most popular estate planning tools is the revocable living trust, but exactly how this kind of trust works is also commonly misunderstood.

Here are some things to understand.

A revocable living trust can be an excellent way to avoid probate/succession proceedings.

In Louisiana, court-supervised succession can be time-consuming and costly. If you put property in a revocable living trust, the property can pass to beneficiaries without succession/probate.

That property could include anything from your house to your bank accounts and stocks.

Because the property does not have to pass through probate, the transfer of the property is kept private.

It's called a "revocable" trust because you can change it -- or cancel it -- as your wishes change.

This aspect of a revocable living trust is very appealing to many people. When financial or family situations change, you might want to change how your trust works, and a revocable trust -- as opposed to an irrevocable trust -- can be changed to match new circumstances.

It's called a "living" trust because you create it during your lifetime.

With a revocable living trust, you can be the trustee during your lifetime, and a successor trustee can take over after you are gone. If properly funded, this kind of trust can also ensure that you are cared for in the event that you become unable to care for yourself.

You can control the manner and timing of payments to beneficiaries.

With a living trust, you can specify how and when beneficiaries receive assets. For example, you can say that the trust assets will be used only for a down-payment on the beneficiary's first home -- or only to fund a college education.

There are some drawbacks.

The main drawbacks are:

1. If you benefit from the trust, that income must be reported for tax purposes.

2. While some trusts can shield assets from creditors, a revocable living trust does not.

For more on these matters, please see our overview of wills and trusts in Louisiana.

No Comments

Leave a comment
Comment Information
Serving Orleans, St. Tammany, Jefferson, St. Bernard, Washington, St. John the Baptist, St. Charles and Plaquemines Parishes
Email Us For A Response

Get Answers Today

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Metairie Office
3000 18th Street
Metairie, LA 70002

Phone: 504-662-9596
Fax: 504-833-2843
Metairie Law Office Map

Covington Office
7020 US-190
Suite A
Covington, LA 70433

Phone: 985-218-0494
Fax: 985-624-9698
Covington Law Office Map