How to Make Sure Your Trust and Will Avoid Probate
The term "living trust will" is not really a legal term. However, a lot of people use the term when they are first investigating a living trust. People commonly think of using a will to distribute property after someone’s death. People think a trust does the same thing as a will, which may cause some confusion.
Wills and living trusts have related, but different legal concepts and documents. In many respects, a living trust can serve many of the same purposes as a standard will. So, as an attorney, I will probably not know what someone wants, if they ask about a "living trust will". There is a legal document called a living trust and a different legal document called a will. A special type of will, a “pour over will,” always accompanies a living trust. A pour over will is a safeguard mechanism for a living trust.
Sometimes living trusts are known as —"living revocable trust" or "revocable living trusts". The key here is that they are revocable. Revocable means that the trust can be changed or withdrawn at any time. People use living trusts to avoid probate and get more value to their heirs without paying any estate taxes. In order to prevent a probate proceeding, a trust must be correctly set up and managed.
Most trusts do not prevent heirs from going through probate. There is some debate in the legal community against living trusts, because they are not providing the probate protection intended. The problem isn’t the trust. The way attorneys are educating their clients is the problem. In order to avoid probate, clients need to be educated on how to "use" their living trust.A living trust will avoid probate if it is handled appropriately. If it doesn’t, then the deceased’s assets will need to be probated. That means the family has to go through a lengthy legal process at the probate court. If the deceased had a will, then the probate court will use the will to guide the probate process. In the absence of a will, an "intestate" proceeding must take place. Intestate means that there isn’t a will.
A pour over will should be drawn in conjunction with a living revocable trust. When assets need to be probated, the probate courts will use the pour over will to help them through the process. The pour over will won’t be needed if the trust works properly and actually avoids probate.
Pour over wills don’t make a distribution of the property, as standard wills do. A pour over will instructs the court to "pour over " all of the assets into the living revocable trust and distribute the assets as stated in the living trust. Revocable living trusts and pour over wills are discussed in detail in Lee R. Phillips’ new book, Guaranteed Millionaire. Get a FREE DVD, "Using the Law to Make Money and Protect Your Assets" by clicking the Free DVD link.