Is a Revocable Trust in Your Estate Plan?
Estate planning is one of the easiest ways you have to plan for your assets and loved ones after death. Thinking about estate planning generally involves considering your assets, family situation, financial goals, and preferences for how your affairs should be handled both during your lifetime and after your passing.
Here’s a structured approach to help you think about estate planning in general and revocable trusts in particular. As always, make sure and consult with a Tulsa estate planning attorney to see you’re your particular situation should be handled.
Estate Planning Approach
Start by making a comprehensive list of all your assets, including real estate, investments, retirement accounts, bank accounts, life insurance policies, business interests, valuable personal property, and any debts or liabilities. Then evaluate your family dynamics, including your marital status, children, grandchildren, and other dependents. Consider their needs, financial capabilities, and any special circumstances that may require special planning, such as disabilities or substance abuse issues.
Think about your goals for the distribution of your assets, both in terms of who will inherit what and when they will receive it. Consider any specific bequests you want to make, charitable giving goals, and any conditions or restrictions you wish to place on inheritances.
You should also plan for the possibility of incapacity during your lifetime. Consider who you would want to make medical and financial decisions on your behalf if you become unable to do so yourself. Your attorney can help with a durable power of attorney for finances and an advance directive for healthcare. Select trusted individuals or professionals to serve as executors, trustees, guardians for minor children, and agents under powers of attorney. Make sure they are willing and able to fulfill their roles responsibly.
Explore strategies to minimize estate taxes, gift taxes, and probate expenses. This may involve setting up trusts, including a revocable trust, making lifetime gifts, and utilizing tax-efficient strategies such as the marital deduction and the unified credit. Revocable trusts are commonly used for estate planning purposes to manage assets during one’s lifetime and facilitate the distribution of assets upon death, often avoiding probate.
In Oklahoma, revocable trusts are subject to state income tax, but they do not provide significant estate tax benefits since the federal estate tax exemption is high. Consult a Tulsa estate planning attorney, financial advisor, and tax advisor to help you navigate the complexities of estate planning and ensure that your plan achieves your goals effectively.
How a Revocable Trust Works
A revocable trust, also known as a living trust, is a legal entity created to hold ownership of assets during a person’s lifetime and distribute them according to the terms of the trust upon their death. A revocable trust can be altered, modified, or revoked entirely by the person who creates the trust, sometimes called the grantor. One of the primary benefits of a revocable trust is its flexibility. The grantor can make changes to the trust, including adding or removing assets, changing beneficiaries, or amending the terms of distribution.
The trustee is an individual or entity responsible for managing the trust assets according to the terms of the trust on behalf of those who will inherit from the trust, sometimes called the beneficiaries. Often the grantor is also the trustee until they pass away. After that, a successor trustee named in the trust takes over the management of the assets and handles distribution.
A Revocable Trust Can Help Your Loved Ones Avoid Probate
One of the primary reasons you may want to consider a revocable trust is to avoid the expense and hassle of probate. Assets held in a revocable trust generally avoid probate upon the grantor’s death, which can save time and money and maintain privacy in the distribution of assets. Once the trust is created and executed it is important to transfer your assets to the trust. Any assets not transferred into the trust may have to go through probate.
A Tulsa estate planning attorney can help with all aspects of a trust, including ensuring that your assets are properly transferred. Remember that laws and regulations may change, so it’s essential to consult with a legal professional familiar with Oklahoma law and estate planning to create a revocable trust that meets your needs and complies with current legal requirements.
Consult With a Tulsa Revocable Trust Attorney
Bring us your questions and let’s see what we can do to help you reach your goals. We are here for you at Oklahoma Will & Trust. To make an appointment for your consultation, call (918) 876-4500. A skilled and sympathetic estate planning attorney can help you take care of your loved ones and reach your estate planning goals.