There are many different reasons to use a revocable living trust as a tool in your estate plan. It can be used to supplement existing documents and strategies, such as a living will. For example, imagine that you want to have additional privacy in your estate so that it does not become a matter of public record in probate.
A trust is an excellent way to decide which assets need to be placed inside the trust to add this layer of privacy and streamlining the administration process for your loved ones. But a trust in and of itself does not accomplish everything you might need in your estate plan.
As your own trustee in a revocable living trust, you can do anything you want with the trust assets.
You can transfer bank accounts, investments and real estate into the trust and are then eligible to manage these assets for your own personal benefit, meaning that you can save, invest or spend trust assets and have derived all principle and income in it. It’s important to realize, however, that there are limitations to a revocable living trust.
A revocable living trust does not avoid income taxes. The primary purpose of this trust is to avoid probate on guardianship proceedings and death in the event of incapacity. You’ll want to sit down with your estate planning lawyer in CA to discuss tax related strategies that can be used to help you accomplish your goals.
