Why do my neighbors have their home in Trusts?

Is it a smart move to put your house in a trust if you plan on moving in the near future .I live in Florida so probate is lengthy and expensive here and my main heir is my daughter who lives in New York .So I want the house to pass as easily as possible to her .

I don't know how trusts work but they made it very easy for us.

Here are the basics from NOLO on using revocable living trusts.

A basic living trust allows property to avoid probate and to quickly and efficiently pass to the beneficiaries you name, without the hassles and expense of probate court proceedings. A married couple can use one basic living trust to handle both co-owned property and the separate property of either spouse.

To create a basic living trust, you make a document called a declaration of trust, which is similar to a will. You name yourself as 'trustee' -- the person in charge of the trust property. If you and your spouse create a trust together, you will be 'co-trustees'.

Then you transfer ownership of some or all of your property to yourself in your capacity as 'trustee'. For example, you might sign a deed transferring your house from yourself to yourself "as trustee of the Jane Smith Revocable Living Trust dated July 12, 20xx." Because you're the 'trustee', you don't give up any control over the property you put in trust.

In the declaration of trust document, you name the people or organizations you want to inherit trust property after your death. You can change those choices if you wish; you can also revoke the trust at any time.

When you die, the person you named in the trust document to take over -- called the 'successor trustee' -- transfers ownership of trust property to the people you want to get it. In most cases, the 'successor trustee' can handle the whole thing in a few weeks with some simple paperwork. No probate court proceedings are required.

Hope that helps a little.
Goon
 
The terminology I am familiar with for the trustees to create and fund the trust are grantor trustees. What you call successor trustees I know as contingent trustees.

The latter trustees need to be able to manage the trust's assets should the grantor/s be unable to do so. Buy and sell property, pay bills, for example. The grantor trustees are the only trustees who can revoke the trust or change its terms.
 
Here in South Africa death and inheritance taxes are very high and the process is long and costly provided it is not the spouse that is inheriting, ie kids, grandchildren etc, so if you wealth is of an amount where taxing is going to be a problem, trusts have to be set up to avoid the mess. There is also a limit as to how much assets can be transferred to a trusts in a year while still avoiding tax, so its something better done sooner rather than later as it takes years to fill a trust. Not sure if the states is the same, but our government usually copies the US verbatim.
 
* It really pisses me off that the state of Hawaii records our home mortgage and thus makes that document a matter of public record. "Mortgage companies" from all over the state and the Mainland pelt us with offers to refinance our mortgage, and they're getting our name/address from the public records. Now imagine if a recorded will listed FarmerEd as the beneficiary of a multi-million estate.

I think most states do this......I get re-fi offers all the time from folks in other states...........:p
 
As a warning, the estate planners I used to work with spend a fair amount of time trying to straighten out home made mucked up trusts.

Also, often people do not successfully avoid probate because they failed to transfer all their assets into the trust.

In your part of the country, and depending on your personal situation, a trust may not be necessary and probate may be simple and easy. Or, in your part of the country, a trust may save you lots of time, money, and grief. As Brat says, a trust can be helpful if you become incompetent so that the successor trustee can manage your assets. However, in some circumstances a power of attorney can work fine to do the same thing. It all depends on your personal situation.

Almost always you need to see a lawyer for your trust planning and estate tax planning. The lawyer may have you do a variety of different, seemingly inconsistent things, so that various options are available to the surviving spouse when one spouse dies to be able to take advantage of both spouse's estate tax exemption.
 
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