The basics of revocable trusts in California

On Behalf of | Jan 10, 2022 | estate planning

When you’re in the process of estate planning, there are several tools that you can use in order to protect your estate and assets and achieve your goals. One of these tools is the revocable trust, which is often used to avoid probate and ensure that estate property goes to the correct people.

What is a revocable trust?

A revocable trust is a legal document that allows you to transfer property into a trust estate during your lifetime. This estate is then managed by a trustee, a person who’s typically appointed by you or chosen by the court. The benefits of using a revocable trust include avoiding probate and ensuring that estate property goes to the correct people.

How is a revocable trust different from an irrevocable trust?

An irrevocable trust is a legal document that allows you to transfer property into a trust estate. However, this estate cannot get changed or modified in any way after its establishment. In other words, an estate planning trustee cannot make changes to the estate since all of its terms are set in stone at the time of creation. On the other hand, it’s possible to change or modify a revocable trust at any time before the estate owner dies.

What are the benefits of a revocable trust?

The main benefit of a revocable estate is that, as the estate owner, you have complete control over it during your lifetime. In other words, there’s no risk for estate property to get lost or transferred incorrectly if something were to happen to you. Another benefit includes avoiding probate and ensuring that estate property goes to the correct people.

Additionally, estate property that’s transferred into a trust estate is generally exempt from estate taxes. This means that the property can go to heirs without them having to pay a large sum of money to the government.

When estate planning, it’s important to understand all of your options and choose the one that best suits your needs. If you’re considering using a revocable trust because of its flexibility and other benefits, be sure to understand how it works to ensure that it meets your estate planning goals.