Revocable living trusts allow for changes at any time. A trust amendment can be created to edit certain provisions or beneficiaries. It is also possible to void or modify the entire contents of the trust through an amendment and reinstatement. The following is advantages and disadvantages of Massachusetts revocable living trusts.
Revocable Living Trusts
The downside of revocable living trusts are that assets in the trust are treated as personal assets. It therefore offers no special protection from creditors if you are sued. Upon death, all assets are subject to any state and federal estate taxes. Depending on your finances, these two items can result in significant risk or loss.
Reasons to Use Revocable Living Trusts
There are a few reasons why you would select revocable living trusts despite the disadvantages noted above. Below are the key reasons that many select this type of trust.
Planning for Disability
Revocable living trusts are often used to plan for future disability. Assets in a revocable trust can be managed by a trustee rather than by a court-assigned guardian in the event of mental disability. This can be an important factor when there is a family history of mental illness.
The type of trust will determine whether the courts get involved. With revocable living trusts, assets are given directly to beneficiaries without going through a court proceeding. This shortens the transfer process and time frame.
Because transfers take place outside of court, the trust agreement does not get filed into public record. Detailed information on your assets may therefore be kept private. The identity and assets transferred to specific beneficiaries is also not disclosed. This maintains the privacy of everyone involved.
More Advantages And Disadvantages Of Massachusetts Revocable Living Trusts
The advantages and disadvantages of Massachusetts revocable living trusts provided above was shared by Peter DaMore at Law Offices of Peter T. DaMore Jr.. For additional information on revocable living trusts and other elements of your estate plan, contact Peter at 781-229-7900 or via email at firstname.lastname@example.org. We can explain the benefits of revocable living trusts and irrevocable trusts and help you select the option that best accommodates your situation.