Revocable Trust

A revocable trust may be beneficial depending on your own circumstances, and can provide a number of benefits not available with just a will.

  • A revocable trust provides an element of privacy.  A will is probated and becomes a matter of public record, while the trust document generally remains private.
  • A revocable trust provides the opportunity to avoid probate. This is not as important in New Jersey, but it is advisable to transfer out of state assets (such as real estate) into a trust in order to avoid potentially complicated probate procedures in other states.
  • A revocable trust can be used as a vehicle for management of your assets.  A power of attorney can generally suffice for this purpose, but there are a few slight differences.
  • A revocable trust provides a level of flexibility in making modifications which is not available with a will.

A revocable trust can provide that assets are to be distributed outright or that assets are to be held in further trust. There are various reasons for using trusts rather than having assets be distributed outright such as:

  • To hold assets of minor children in order to avoid the expenses and delays of guardianship.
  • To protect bequests from claims of the beneficiary’s creditor’s, including claims of a prior spouse.
  • To avoid future estate taxes on bequests due to the inclusion of those assets in your descendants’ estates.
  • To provide for an individual who is otherwise unable to manage his or her assets due to any type of incapacity.
  • To benefit an individual without disqualifying that individual for government benefits, and without causing the assets to be consumed prior to the availability of government benefits.
  • To provide currently for an individual during that person’s lifetime and designate who will be the beneficiaries thereafter.
  • To hold assets gifted to younger individuals during your lifetime in order to remove the gifted assets from your taxable estate.
  • To hold assets after your death in a pooled fund for the benefit of your minor children in a manner similar to that which those assets would have been held had you survived until all of the children have reached adulthood in order to provide for children of various ages who may have disproportionate needs.