It is not uncommon for a person to forget to transfer assets into his/her trust. Contact A People’s Choice if you need help creating and funding a trust in California. Yes, it is important to create a living trust so your estate will avoid probate. However it is equally important to make sure your trust is properly funded and that no assets are inadvertently left out. Read on to learn more about assets commonly left out of trust in error.
Assets Commonly Left Out of Trust in Error
Below is a brief list of assets commonly left out of trust in error. This list is certainly not all-inclusive, and every person who sets up a living trust needs to diligently review their own list of assets. Remember to transfer any of the following items (if applicable) into your trust:
Loans Secured by a Deed of Trust
Transfer all loans secured by a deed of trust into your trust. Promissory notes and deeds of trust are on the top of the list of assets commonly left out of trust in error and forgotten in trust funding. Make the promissory note and deed of trust payable to the trust. This may require recording an assignment of the deed of trust.
Government Bonds are also on the top of the list of assets commonly left out of trust. Most people keep government bonds in a safe. Transfer any government bonds from your name into the name of your trust. Cash low-value bonds and put the money in a bank account within your trust.
Other assets commonly forgotten in trust funding include stock certificates. Be sure to transfer stock certificates into your brokerage account if they are commonly traded. All other stock certificates held in your personal safe should be signed over and formally transferred to your trust.
Assignment of Business Interests
Assign all of your business interests to your trust. Business interests often make it on the list of assets commonly left out of trust. Business interests include shares of stock and partnership interests which are assets commonly forgotten in trust funding.
Rental & Vacation Properties
In addition to your primary residence, transfer the title of your rental and vacation properties into your trust. This will help your estate avoid probate. We can help you complete the title transfer documents for your timeshares which are high on the list of assets commonly left out of trust in error during trust funding.
Tangible Personal Property
Place personal property into your trust. This includes valuable jewelry, antiques, collectibles, and art work. Since most personal property does not have a title document, transferring personal property to a trust is usually addressed by signing a special addendum to the trust.
Royalties, Copyrights, Trademarks & Patents
Transfer royalties, copyrights, trademarks and patents into your trust. Contact the United States Copyright Office and/or the United States Patent and Trademark Office for more information.
Non-Retirement Investment & Brokerage Accounts
Non-retirement investment and brokerage accounts include personal and jointly held accounts held in your name. Be careful transferring a 401(k) or IRA into your trust. Doing so may trigger tax consequences.
Oil, Gas & Mineral Rights
Assign or make a new deed to transfer your oil, gas and mineral rights into your trust.
A pour-over will acts like a safety net and catches any forgotten assets and sends it (pours it over) to a trust. Proper estate planning with a revocable living trust should always include a pour-over will. Assets commonly left out of trust can be poured over into a living trust through a pour-over will after the death of a trustee. Although a pour-over will allows the assets to be distributed according to the terms of a trust, these omitted assets may still need to be probated if they exceed $166,250 in value.
There are many ways to make sure that assets commonly forgotten in trust funding are not omitted from your living trust. Ask us about our living trust package or how we can help create a pour-over will to avoid probate if you don’t have one. Contact A People’s Choice for more information on how to create and fund a trust. You can call us at 800-747-2780. Please feel free to share this article with other people who would benefit from the information mentioned above.
Was this article helpful? We would love to know your thoughts! If you found this article helpful, please check the LIKE button below. Your feedback helps us plan topics for future articles.