MORE ON "THE LIVING TRUST"

In its most basic terms, the promoters of the Living Trust argue that you should transfer all of your assets to the Living Trust while you are alive. You (or you and your spouse) are the trustees of the trust and manage the trust assets for your own benefit. You can change or cancel the arrangement at any time. In sum, while you are alive nothing has really changed except that your assets are technically owned by the Living Trust, rather than by you as an individual. All of the supposed benefits of the trust come into fruition when you die. The promoters state that your assets automatically pass to your beneficiaries without the delay or expense of probate. The Living Trust also claims to ensure privacy and save thousands of dollars in attorneys fees. Finally, the promoters also mention how the Living Trust will save on estate taxes. Now I attended one seminar where a question was proposed: "Will this work if I have a home in Florida too?" The promoter responded: "Yes, we will hire an attorney in Florida to transfer title to the Living Trust, for a small additional fee, and thus you can avoid probate in Florida." But according to Florida attorney Ronald A. Jones: "The problem is that Florida law provides that a revocable trust is liable for the estate debts of the decedent; and there is a 2 year statute of nonclaim. In other words, if someone dies with a revocable trust, at least theoretically the trust is on the hook for 2 years after the person dies for any debts or claims against the person who died, and if the trustee distributes, or passes out the money to the beneficiaries before the 2 years is up, and that results in the trust not having the money to pay creditors, the trustee is liable to the creditors until the 2 years is up. However, there is an exception to this: if a probate is brought, and the estate is advertised, then the period the trust is liable is limited to 3 months after the first date of the advertisement of the estate. From a practical viewpoint, it makes a great deal of sense to bring a probate, and to close out creditors claims to 3 months after the advertisement, at least if there aren't a lot of bills to pay. Otherwise, the successor trustee would be very foolish to pay the beneficiaries if the trustee might be on the hook for 2 years. So, from a practical viewpoint, most, if not nearly all, revocable trusts in Florida wind up having a probate brought in order to close out creditors claims before the 2 years are up. If a probate is going to be brought to close out creditors claims, then there is not much point to a revocable trust for the sake of avoiding probate." Thus, my recommendation is that if you do decide a "Living Trust" is for you and you have out-of-state assets, I would consult with an "out-of-state" attorney to see if the New York "Living Trust" will work with that out-of-state asset.