There are many benefits to using a revocable living trust as your primary estate planning document in Georgia. In this article, we take a look at several benefits of revocable living trusts and the funding requirements required to take advantage of each benefit. Some benefits, like avoiding probate, are easily explained. Others, like incapacity planning and minimizing post-death disputes, are more nuanced.

For more information, working with an experienced Atlanta living trust lawyer can be helpful. At Trace Brooks Law, we can walk you through the different benefits of a revocable living trust and how it can be a useful addition to your estate plan. Contact us today at (404) 492-9559 to schedule a consultation.

Added privacy by avoiding probate. In Georgia, a will must be filed with the probate court of the county where the decedent resided, as well as any ancillary probate courts. This requirement applies even if all assets pass outside the probate estate and no formal probate is necessary. Revocable living trusts, on the other hand, are private documents that are not typically filed with any court and therefore do not become public records. To take advantage of the added privacy that a revocable living trust provides, you must fully fund your trust.

Avoid out-of-state probate. A revocable living trust can be a valuable tool to help you avoid probate if you own or may acquire real property outside your state of residence. In general, a will must be probated in each state where you own real property at your death, in addition to the state of your primary residence (even if you do not own property in that state). However, if your out-of-state property is owned by your revocable living trust, there is generally no need to probate your will in that state because the property owner – the trust – has not passed away. By using this ownership structure, the trustee of the revocable living trust can more quickly and cost-effectively transfer title to the intended beneficiaries. To take advantage of this benefit, you only need to transfer your out-of-state real property to your revocable living trust.

Incapacity Planning. A revocable living trust can be an essential tool to ease the burden on your loved ones if you become incapacitated. Unlike a will, a revocable living trust can provide protection both during life and after death. With a fully-funded revocable living trust, the management of your assets during your incapacity and after your death becomes much simpler for your loved ones. While it may take some additional initial effort to fully fund your revocable living trust, it can be well worth it to ease the burden on your loved ones.

As the legal owner of the trust assets, a trustee of a revocable living trust has an easier time managing the assets in question than someone acting under a power of attorney. The trustee’s legal authority makes it easier for banks, government institutions, and other third parties to accept and recognize the trustee’s authority.

Additionally, a revocable living trust is one of the most powerful ways to protect yourself, your loved ones, and your wishes if you suffer from a weakened mental state later in life. Declining mental and physical function commonly occurs later in life and is often imperceptible at first. Many aging people go through a period of several years where they are not fully incapacitated but have decreased mental capacity and make increasingly poor decisions. A revocable living trust can help prevent others from taking advantage of you during periods of declining cognitive capacity by preventing you from engaging in harmful or ill-advised transactions.

With a revocable living trust, you or your agent can transfer your assets to the trust, allowing a co-trustee or successor trustee to manage your financial affairs. To enable others to manage your affairs under a revocable living trust, you can resign as trustee or be removed if you are determined to be incapacitated under the terms of the trust. The choice of a co-trustee or successor trustee is critical in protecting yourself and your loved ones, and should be carefully considered.

In Georgia, easing the administrative burden on loved ones by planning for incapacity is one of the primary reasons to use a revocable living trust as your primary estate planning document. Though assets must be in your revocable living trust to take advantage of this benefit, they can be transferred by you or by your agent acting under a power of attorney if you become incapacitated.

Avoid post-death disputes. A revocable living trust can be a valuable tool to avoid post-death disputes, especially for those with complex family situations or those who wish to distribute their assets unequally or to non-family members. Legal disputes often arise when family members or other beneficiaries disagree with the distribution of assets outlined in a will or trust. By using a fully-funded revocable living trust, you may curtail these disputes because assets owned by the trust do not go through probate – making it more difficult for disgruntled family members to challenge the distribution of assets. Further, it is generally more difficult to successfully challenge a trust than a will.

A post-death dispute can also arise if the surviving spouse makes a claim for “Year’s Support” from their deceased spouse’s probate estate. Assets that are held in a revocable living trust, however, are not subject to a potential Year’s Support claim. This can be advantageous in blended or contentious families, particularly where the spouse and heirs may have conflicting interests.

To avoid post-death disputes, owning your assets in a revocable living trust can help ensure that your estate planning wishes are carried out. You must fully fund your revocable living trust to help realize these benefits.

Ease of moving to another state. For individuals who may move to another state, revocable living trusts offer greater flexibility and cost-effectiveness than wills. While states generally recognize wills created under the laws of another state, updating a will-based estate plan to take full advantage of the probate and estate administration laws in a new state can be a costly and time-intensive process. Revocable living trusts, however, avoid this issue, as a well-drafted trust contains all the necessary provisions, regardless of state of residence. Therefore, only the standard and less expensive powers of attorney and pour-over will need to be redone upon moving to a new state.

It is important to update your estate plan, regardless of whether you use a will or a revocable living trust as your primary estate planning document, to reflect your new home state’s laws. Fully funding your revocable living trust is not necessary to realize this benefit.

Easily make and change specific bequests. Georgia law allows individuals to make specific bequests of tangible personal property such as artwork, collectibles, and jewelry before the remaining assets are distributed. A revocable living trust allows for the creation of a schedule of specific bequests that can include any type of property, including money, without the need for an attorney’s assistance. Therefore, creating and modifying a schedule of specific bequests in a revocable living trust is cost-effective and can be done at little to no cost without the help of an attorney. (You should, of course, advise your attorney of any changes to your specific bequests.) When using a will as your primary estate planning document, providing a specific bequest would require amending the will every time changes to the specific bequest list are desired, which would require the assistance of an attorney. Fully funding your revocable living trust is not necessary to realize this benefit.

To use a corporate fiduciary as your agent under your power of attorney. While most corporate fiduciaries are hesitant to serve as an agent under your power of attorney, some are willing to do so if they are also named as the successor trustee under your revocable living trust. If you become incapacitated, the corporate fiduciary would use their authority under the power of attorney to transfer your assets to your revocable living trust, where they will serve as successor trustees. Because you cannot typically change the ownership of tax-deferred retirement accounts, such as IRAs or 401(k)s, to a revocable living trust during your lifetime without incurring negative tax consequences, the corporate fiduciary should use your power of attorney to manage these accounts. Fully funding your revocable living trust is not necessary to realize this benefit.

As you can see, there are many benefits to using a revocable living trust as your primary estate planning document in Georgia. Contact an Atlanta Estate Planning Attorney at Trace Brooks Law today to discuss whether a revocable living trust is right for you.