Virginia Beach Revocable Living Trust Lawyer
Take Care of the Ones You Love While Avoiding Probate and Prying Eyes
Among the many documents that make up a comprehensive estate plan, revocable living trusts stand out as a major vehicle for transferring wealth and property to the next generation. Revocable living trusts serve as the “hub” of the estate plan, holding property that makes up the bulk, if not all, of an inheritance. The Law Office of Angela N. Manz works with families across all the diverse communities of Virginia Beach, ensuring they understand their options when it comes to estate planning and make the most of the tools available to them, including trusts. Contact our experienced Virginia Beach revocable living trust lawyers today to talk about your needs, goals, dreams and desires for now and the future.
What Is a Revocable Living Trust?
A revocable living trust is a legal entity created to hold ownership of an individual’s assets. It is termed “revocable” because the person who creates the trust (known as the “settlor” in the Virginia Trust Code) can make changes to it or dissolve it during their lifetime. This flexibility distinguishes it from an irrevocable trust, which cannot be easily changed once established. It is called a living trust because it is created during the settlor’s lifetime, as opposed to a testamentary trust, which comes into being after its creator passes and their will goes into effect.
A trust, in essence, is a legal entity that holds property and assets put into it by the settlor. The settlor appoints a trustee to manage the property for the benefit of one or more beneficiaries named in the trust. The trustee holds “legal title” to the property in the trust while the beneficiaries have “equitable title,” or a legal interest in the property. At the proper time, according to the terms of the trust, the trustee may transfer legal title to the beneficiaries, who will then own the property outright.
Often, the settlor acts as trustee and retains control over the property during their lifetime. In the trust, the settlor names a “successor trustee” who will take over the role when the settlor becomes incapacitated or passes away, managing the property and transferring it to beneficiaries according to the provisions established by the settlor.
Benefits of a Revocable Living Trust
A revocable living trust offers many distinct advantages when compared to a will, which is the other chief way people choose to distribute their assets to heirs and beneficiaries. Some of the numerous benefits of a trust include the following:
- Avoiding Probate: One of the main reasons individuals opt for revocable living trusts is to avoid the probate process. Assets held within a trust avoid probate, leading to a smoother and often faster distribution to beneficiaries. A will, on the other hand, must go through probate, and heirs to a will must wait months or years for probate to wrap up before they receive their inheritance.
- Privacy: Unlike a will, which becomes a public document upon one’s death, a trust is private and stays private. This means the details of one’s assets and to whom they are distributed remain confidential.
- Flexibility: Given that it’s revocable, the trust can be altered as life circumstances change. Whether it’s the acquisition of new assets or changes in beneficiary designations, the trust can be adapted accordingly.
- Financial Management: A revocable living trust allows for continuous financial management. As your wealth accumulates, so too will the assets in the trust.
- Separation of Assets: A revocable living trust can allow for separation of assets, which can be useful for married couples.
Setting Up a Revocable Living Trust in Virginia Beach
- Choose the Trustee: The settlor often acts as the initial trustee, but it’s essential to designate a successor trustee who will manage the trust’s assets if the settlor becomes incapacitated, or after their passing.
- Draft the Trust Agreement: This is a legal document that outlines the terms of the trust, including beneficiary designations and trustee powers. It is imperative to work with a knowledgeable estate planning attorney to ensure that the agreement aligns with Virginia laws and individual preferences.
- Fund the Trust: Once the trust is established, it is necessary to transfer assets into it, be it real estate, bank accounts, or other property. This step is vital; without it, the trust doesn’t hold any value.
A trust is not a simple legal document. It is highly recommended to use an experienced trust attorney to create a valid, enforceable trust that is customized to your particular needs.
Common Misconceptions About Revocable Living Trusts
- Complete Asset Protection: While revocable living trusts offer many benefits, they do not protect assets from the settlor’s creditors. If asset protection is a primary concern, other planning tools may be more appropriate, including one or more irrevocable trusts. Regardless, you can likely still benefit from a revocable living trust as part of your comprehensive estate plan.
- Elimination of Taxes: The assets within the trust are still subject to estate taxes if their value exceeds the federal estate tax exemption amount. Consultation with an attorney can provide clarity on potential tax implications and strategies to minimize them. Note that under current law, only the wealthiest need to be concerned about estate taxes. If you are lucky enough to fall into this category, additional planning can help you minimize or avoid estate taxes.
Contact The Law Office of Angela N. Manz for Help With Trusts in Virginia Beach
Revocable living trusts can be a powerful tool in one’s estate planning arsenal, offering flexibility, privacy, and a streamlined process for asset distribution. However, like all estate planning tools, it’s essential to understand their features and limitations fully.
At The Law Office of Angela N. Manz in Virginia Beach, we’re committed to providing our clients with clear, comprehensive information to help them make informed decisions about their future. Reach out to our experienced team to discuss how a revocable living trust could align with your estate planning goals.