Funding a Trust

Funding a revocable trust is as important as creating one and involves transferring assets from the donor’s individual name to the name of the trust. There are several benefits to funding the trust during the donor’s lifetime. Such funding allows a donor to establish a relationship with the trustees and to understand their approach and capabilities in the event of her incapacity. When needed, the trustees are also able to manage the trust’s assets without interruption or delay. Unlike a conservatorship, a court-supervised procedure, the trustee will retain complete control of the trust assets during any period of the donor’s incapacity, without any interference from the court. If the trust is funded during the donor’s lifetime, the assets will not require any further movement on the donor’s death, and the property can continue to be managed or distributed without the involvement of the probate court.

Funding a revocable trust during one’s life does not cause complicated tax consequences. The assets in the revocable trust are reported to the IRS as the donor’s personal assets, and any gains or losses are recorded using the donor’s tax identification number. Additionally, there is no tax liability on any payments made from the trust to the donor. However, funding a revocable trust does not eliminate the possibility of paying estate taxes. The assets held in trust may still be subject to an estate tax, if one would otherwise have been due. The donor can also control the taxable disposition of assets by utilizing appropriate federal and state estate tax credits, as well as beneficial charitable deductions.

Questions about how to properly fund your trust? TAP HERE

What People Are Saying

  • D. BROWN

    “

    I am writing to express my appreciation for the excellent customer service which I have received from American Family Estate Planners .Charles Leonhardt was the kind of professional person I was looking for to explain the difference between a revocable living trust and a will. He had the knowledge and experience that showed as he explained the difference between the two. He answered all my questions and was patient to make sure he covered everything that was important to me. Everything was done in order and I am very grateful that I don’t have to worry if anything changes in my life. It’s all done and placed in a Revocable Living Trust Portfolio by American Family Estate Planners. I am happy and recommend them highly. I had to add that he has returned my call even after doing this a year ago for questions I had. That’s a plus for me.

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    “

    Working with American Family Estate Planning was so beneficial to my husband and I as we planned for our future. They are knowledgeable and provided the necessary information and resources to facilitate an effective and comprehensive Estate plan. We would highly recommend them.

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    “

    We had a great experience working with American Family Estate Planners. Doing a will and a revocable trust is quite the process no matter whom you work with, and they were with us every single step of the way. I’m one of those people who ask a lot of questions so I can learn and understand new things, and Charles was more than patient when answering every single question and in a timely manner. They also have a really neat business model with many benefits most attorneys offices do not offer. Even with all of that, their prices still saved us a lot of money. I highly recommend them!

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    Our experience with American Family Estate Planners (AFEP) under the direction of Daniel and Charles Leonhart far exceeded our expectations. We had an estate plan in place from our time in Missouri which less than satisfactory. Charles through AFEP restored our faith in a process we knew could be better. Through our interactions from start to finish, we experienced the highest degree of professionalism and satisfaction. Most importantly, Charles and the AFEP legal team always returned phone calls, and always showed up on time for discussions as the process of formulating our estate plan moved forward. The promised legal documents were delivered on time as promised. The final delivery and signature phase also included a thorough explanation of exactly what was included in the package.

    I highly recommend Charles Leonhardt and American Family Estate Planners for great service and delivery of a total estate package at a fair

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“Only put off until tomorrow what you are willing to die having left undone.”

— Pablo Picasso.