Revocable living trusts can be excellent financial options for New York residents who want to protect certain assets by removing them from grantor ownership. The primary goal of establishing a revocable living trust is avoiding the probate process following death. Probate actually involves the state of residence stepping in and deciding who gets the assets left behind, including outstanding creditors and tax assessors. This is a central reason why revocable living trusts are a good decision for those with moderate wealth as well as those with significant assets to protect.
Trust instead of a will
One of the biggest problems with a will is that the state can use it as a directive, but a person’s wishes are not always followed. Not only can creditors and governments attach to any probate assets, but a will can also be contested in court. This can make a probate process long and costly as well as divide a family. This is the major reason everyone should at least consider establishing a revocable living trust when estate planning.
Tax evasion is illegal while tax avoidance is not. This even applies after passing. Establishing a revocable living trust means that assets can be assigned as property to another party beforehand and pass outside of probate. This is crucial in effective estate planning as even those with no outstanding creditors wanting to claim assets will still have tax concerns regarding assets that could go through probate with only a will to use as an advanced directive. A trust can also be crafted in a manner that controls how the assets are used after passing, which makes them an excellent tool for governing assets intended to help others and grow through strategic investment in the future.
These are just some primary examples of how a revocable living trust can be much more advantageous than merely creating a will before passing. Not only does it avoid probate vulnerability for assets, but it can benefit the family and other intended beneficiaries in the future for many years to come.