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<\/a>\n\u00a0Now, it is not exactly correct to say that a trust holds title to the assets.\u00a0 Actually, it is the trustee of the trust who holds title.\u00a0 Thus, to open a trust bank account, the account would be opened in the name of the trustee or trustees, as trustees.\u00a0 As an example, if Jane Brown opens a bank account for her revocable trust, the title of the account might be as follows: Jane Brown, trustee of the Jane Brown Living Trust, dated March 31, 2011.\u00a0<\/p>\n
Often no harm is done in leaving bank accounts out of the trust.\u00a0 In California, up to a total of $100,000 can be held outside of the trust without having to go through probate.\u00a0 So a checking account with say $5,000 in it would not be at risk of requiring a formal probate, unless that $5,000 was enough combined with other non-trust assets to push the total over $100,000.\u00a0 In addition, trusts often provide for management in the case of the incapacity of the trustee, but those provisions would not be applicable to non-trust assets.\u00a0 For these reasons, it is preferred to transfer all bank accounts, CDs and money market accounts to the trust.<\/p>\n
The trustees and their successors in trust should be made the primary beneficiary of life insurance policies.\u00a0 As with bank accounts, changing the beneficiary of the insurance policy is not always done, because life insurance policy proceeds still avoid probate as long as the policy names individuals as beneficiaries.\u00a0 The reason to name the trust as the beneficiary is thus not to avoid probate but to get the benefit of the other trust provisions.\u00a0 For example, the trust can provide that the trustee will hold the share of a minor child and apply the income and principal for the minor\u2019s benefit until the child becomes old enough to manage the money on his own.\u00a0 Those provisions would not apply to non-trust assets.<\/p>\n
Real estate is what makes the creation and funding of living trusts crucial in California.\u00a0 It is almost a certainty that real estate left out of a trust will require a formal probate.\u00a0 Putting real estate into a trust requires executing a new deed transferring the assets to the trustees of the new trust.\u00a0 To go back to the Jane Brown example, a new deed would be executed in which Jane Brown, a single woman, grants to Jane Brown, trustee of the Jane Brown Living Trust, dated March 31, 2011.\u00a0 The new deed needs a legal description of the property and it should be recorded in the County Recorder\u2019s office, along with a Preliminary Change of Ownership Report.<\/p>\n
Retirement accounts, such as IRAs and 401ks, are a little more complicated.\u00a0 They will be discussed, along with stocks and bonds, in the next posting.<\/p>\n In the meantime, remember, a trust does not serve its purpose unless it is funded.<\/p>\n Funding a living trust refers to transferring assets into the trust. If a trust is a box then funding the trust means putting assets into the box.\u00a0 For assets that are titled, such as real estate, accounts, stocks and bonds, … Continue reading ![\"i](\"http:\/\/farm4.static.flickr.com\/3467\/3296509876_e0e003f574_m.jpg\")
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\nSo far, we have not discussed automobiles because, in California, automobiles are exempt from probate.\u00a0 The decedent\u2019s automobiles can be transferred to the trustee simply by using a California DMV form.<\/p>\n![\"Creative](\"http:\/\/www.rbillingslaw.com\/blog\/wp-content\/plugins\/photo-dropper\/images\/cc.png\")
<\/a> photo<\/a> credits: bennylin0724<\/a>;\u00a0\u00a0wellohorld<\/a>\u00a0<\/small><\/p>\n","protected":false},"excerpt":{"rendered":"