"What is a revocable trust and how does this legal instrument work?"

Answer:  A revocable trust is one type of trust.  In general, trusts present many planning opportunities.  The hallmark of a revocable trust is that it may be revoked or amended at any time.  Other trusts cannot be revoked.  These are called “irrevocable”.  In some jurisdictions the revocable trust is called a “living trust.”   Some of the purposes of a revocable trust are:  To avoid probate at death, including more than one probate if you have properties in more than one state and prevent court oversight and control of the disposition of your assets if you become incapacitated.  If your assets are held in a revocable trust, they may be more rapidly distributed to your beneficiaries than through the probate process.  A properly drafted revocable trust may reduce or eliminate estate taxes.  A revocable trust is difficult to contest and can prevent court oversight of minors’ inheritances.  In that instance, you choose who oversees the minor’s monies.  It can prevent problems that occur with joint ownership of property, and unintended results upon death.  A revocable trust is not expensive to set up.

A trust like this works when you transfer your assets from your name to the trust over which you maintain control during your lifetime.  Technically the trust owns everything you transfer into it, but YOU maintain control and can do anything you want to do with those assets during your lifetime.  If you become incapacitated, the trust and not the court will control you assets. You do not have to have a separate tax ID for a revocable trust.  There are times when a revocable trust may not  be a good idea is when you need to protect assets for long-term care needs.  This is because the assets in this type of trust are fully countable, and will have to be spent down before you may seek Medicaid benefits.  Sometimes people place their primary residence into a revocable trust.  The difficulty here is that for Medicaid purposes you have transferred an asset that is not countable when you seek Medicaid, and made it entirely countable by the transfer into the trust. 

These trusts should be drafted for you by a qualified estate  planning and elder law  attorney IN YOUR STATE who specializes in Elder Law and Estate Planning, following a full intake to ensure that this move is right for you.  Please note:  I am a Massachusetts elder law attorney, and the law may be different elsewhere.

To locate attorneys in your state who can help you with this elder care matter, I would recommend that you search the ElderCare Matters listing of experts at www.ElderCareMatters.com/statechapters.htm.

Susana Lannik, Attorney at Law
Newton, MA  02458
617-658-2980
Member of the national ElderCare Matters Alliance, Massachusetts chapter

Recent Posts

Stay in Touch with Elder Care Matters

 Facebook  Twitter  Google Plus  Linked  Blogger

eNewsletter Sign Up

ElderCare Answers

If you need answers to your elder care questions, send your questions to us at:

Answers@ElderCareMatters.com

Answers are provided by our ElderCare Matters Partners, some of America's TOP Elder Care Professionals who have years of experience in helping families plan for and deal with a wide range of Elder Care / Senior Care Services.

All Q&A's are posted on the homepage of ElderCareMatters.com

ElderCare Matters Articles

ElderCare Matters Articles are useful and up-to-date Elder Care / Senior Care articles that are provided by our ElderCare Matters Partners to help you plan for and deal with your family's elder care matters.

If you help familes plan for or deal with elder care matters, then you owe it to yourself and to families across America to become a professional member of the National ElderCare Matters Alliance and to be listed on the many Elder Care / Senior Care Directories that are sponsored by this National Alliance of Elder Care Professionals.

ElderCareDirectories.com

For additional information about professional membership in the National ElderCare Matters Alliance, (including the many benefits of becoming one of our ElderCare Matters Partners) and to download an Application for your Basic, Premium or Partner Membership in the National ElderCare Matters Alliance, visit: ElderCare Matters Alliance.