Living Trusts are a way to avoid probate. Assets held in the name of the Trustee of a Living Trust pass to heirs and beneficiaries without probate. The Trustee of the living Trust can be you. When you create a Living Trust, you never lose control of any of your assets or property because you are the Trustee. Thus, by creating a Living Trust, you save your heirs the costs of probate.
When you create a Living Trust, you can specify that if you become incapacitated a person of your choosing can take over your property and take care of you. This could enable you to avoid the impact of Florida’s Guardianship Law, since it would not be necessary to have a guardian appointed because the Living Trust takes care of the matter. Florida’s Guardianship Law is costly, cumbersome and, quite frankly, degrading. It is often a wise idea to create a “guardianship plan” in the trust document.
By virtue of a Living Trust, you can take full advantage of all of the Federal tax credits that the Internal Revenue Code allows. A couple with a Federally taxable estate without a proper estate plan, may very possibly find that at the death of the both of them, there will be a Federal Estate Tax obligation in excess of several hundred thousand dollars. This could be avoided by use of a properly drawn Living Trust in which language is used enabling both the husband and wife to take full advantage of the tax laws. Thus, on a Federally taxable estate, you could avoid paying any tax (as well as avoiding any probate fees).
Great caution should be exercised when having trusts drawn by non-lawyers since recent legislation has added to the complexity of trusts. Also, you should always meet with the attorney who is preparing your trust documents. Insist on it.