|
I've been reading the Nolo books on estate planning, and the examples given
state that when a piece of property is transferred into a living trust, the
title is changed to read something like "John Doe Revocable Living Trust".
The books go on to explain that if the trust is revoked and a new trust is
created (because there were major changes made), then all property must be
transferred into this new trust. But, if the name of the trust is still
"John Doe Revocable Living Trust", then all property is already in the
trust, because it was transferred for the previous incarnation of the trust.
So why would it say that all property be transferred into the new trust ?
Thanks,
Charlie
|
| |
| |
I've been reading the Nolo books on estate planning, and the
examples given
state that when a piece of property is transferred into a living
trust, the
title is changed to read something like "John Doe Revocable
Living Trust".
The books go on to explain that if the trust is revoked and a
new trust is
created (because there were major changes made), then all
property must be
transferred into this new trust. But, if the name of the trust
is still
"John Doe Revocable Living Trust", then all property is already
in the
trust, because it was transferred for the previous incarnation
of the trust.
So why would it say that all property be transferred into the
new trust ?
The proper name of the trust is: "John Doe Revocable Living Trust
dated 12-24-03."
And the proper way to hold title is: "John Doe as Trustee Under
the John Doe
Revocable Living Trust dated 12-24-03."
You can add property to the trust at any time, and you can remove
it just as easilly.
Just sell it, or dispose of it however you want to. Or use a deed
or bill of sale or
letter of transfer and assignment. "Major" changes don't
necessitate revocation.
But if the trust is revoked for some reason, transfer the property
to a new trust with
a new name. The date at the end of the trust name would be
different, so everyone
can tell one trust from the next.
McGyver
|
| |
| |
In article <k2hjuvolr3m1n5p7lrr40qm0dnma17b75e@4ax.com>, Charlie Toohey wrote:
I've been reading the Nolo books on estate planning, and the examples given
state that when a piece of property is transferred into a living trust, the
title is changed to read something like "John Doe Revocable Living Trust".
The books go on to explain that if the trust is revoked and a new trust is
created (because there were major changes made), then all property must be
transferred into this new trust. But, if the name of the trust is still
"John Doe Revocable Living Trust", then all property is already in the
trust, because it was transferred for the previous incarnation of the trust.
So why would it say that all property be transferred into the new trust ?
I believe the deed normally reads "John Doe Living Trust" under Declaration of
Trust dated January 2, 2000. In this case, the trust date would change.
Disclaimer - I am not a lawyer - get the appropriate professional advise.
|
| |
| |
I've been reading the Nolo books on estate planning, and the examples given
state that when a piece of property is transferred into a living trust, the
title is changed to read something like "John Doe Revocable Living Trust".
The books go on to explain that if the trust is revoked and a new trust is
created (because there were major changes made), then all property must be
transferred into this new trust. But, if the name of the trust is still
"John Doe Revocable Living Trust", then all property is already in the
trust, because it was transferred for the previous incarnation of the trust.
So why would it say that all property be transferred into the new trust ?
1. A trust is not an entity. How you title land when put in a trust
depends entirely on your state (or jurisdiction) law. In some
jurisdictions you title land "John Doe ttee under trust indenture dtd
1/1/2000" or equivalent. In others you can just say "John Roe grantor
trust", etc.
2. When you amend a living trust you do not terminate it. But if you
replace (you said "revoked") a living trust with a new one, you need
to make clear to the general public what you have done. This may (or
may not) have transfer tax (and, conceivably but probably not, capital
gains tax) implications.
|
| |
| |
"Charlie Toohey" <toohey@ix.netcom.com> wrote:
I've been reading the Nolo books on estate planning, and the
examples given state that when a piece of property is
transferred into a living trust, the title is changed to read
something like "John Doe Revocable Living Trust".
The books go on to explain that if the trust is revoked and a
new trust is created (because there were major changes made),
then all property must be transferred into this new trust. But,
if the name of the trust is still "John Doe Revocable Living
Trust", then all property is already in the trust, because it
was transferred for the previous incarnation of the trust. So
why would it say that all property be transferred into the new
trust ?
There are two answers to this. First, if there is a major change to
a revocable trust, it does not need to be terminated and replaced
with a new one. All you need is an amended trust, which will be the
same trust but with different terms. That's what a revocable trust
is for and what it allows you to do.
If you insist on a separate trust, though, trusts are generally
referred to by the name, and by the date executed. So a deed might
read, "to The John Doe Revocable Trust, under declaration of trust
dated 2/2/03." If there is a later trust, it will have a later
date.
Stu
|
| |
| |
Tam wrote:
1. A trust is not an entity.
That is incorrect. A living trust may not be TAXED as an entity,
but it IS a separate entity from the grantor and trustee, even if
the same.
--
This account is subject to a persistent MS Blaster and SWEN attack.
I think I've got the problem resolved, but, if you E-mail me
and it bounces, a second try might work.
However, please reply in newsgroup.
|
| |
| |
On Tue, 30 Dec 2003 16:15:47 -0500, "Arthur L. Rubin"
<ronnirubin@sprintmail.com> wrote:
Tam wrote:
1. A trust is not an entity.
That is incorrect. A living trust may not be TAXED as an entity,
but it IS a separate entity from the grantor and trustee, even if
the same.
Not as a matter of common law.
A corporation has an existence that is separate from both the
shareholders and the directors of the corporation, but a trust has no
legal existence separate from the trustee (or trustees).
**Dan Evans
**I post information, not advice.
|
| |
| |
Dan Evans wrote:
On Tue, 30 Dec 2003 16:15:47 -0500, "Arthur L. Rubin"
<ronnirubin@sprintmail.com> wrote:
1. A trust is not an entity.
Not as a matter of common law.
Dan -- I'll have to take your word for it. But -- in the event
the trustee and beneficiary are NOT the same -- the trust assets
can (usually) be reached for debts of the beneficiary, not the
trustee.
Treating my sister and I as "I" for the purpose of this paragraph,
I am the trustee of a testamentary trust funded by my mother's death,
where my father can reach the assets or income as needed, but I
can only reach the income of the trust. (End definition of "I".)
I've had occasion to research what I'm allowed to do or may be
required to do.
Now, a living trust (by which I mean a revocable trust with no
distribution requirements and with the same trustee and beneficiary)
may have no legal existence apart from the individual.
--
This account is subject to a persistent MS Blaster and SWEN attack.
I think I've got the problem resolved, but, if you E-mail me
and it bounces, a second try might work.
However, please reply in newsgroup.
|
| |
| |
Dan Evans <dan@evans-legal.com> wrote:
On Tue, 30 Dec 2003 16:15:47 -0500, "Arthur L. Rubin"
<ronnirubin@sprintmail.com> wrote:
1. A trust is not an entity.
Not as a matter of common law.
A corporation has an existence that is separate from both the
shareholders and the directors of the corporation, but a trust
has no legal existence separate from the trustee (or trustees).
If that were the case, when a trustee dies the trust must terminate.
The rule, however, is that if a trustee dies and no mechanism to
select another is provided, a court can select a trustee, and the
trust can continue its existence.
Stu
|
| |
| |
On 6/1/04 14:50, in article onilvvk6pfj9o8hilp9puov6412p97jnui@4ax.com,
"Stuart O. Bronstein" <spamtrap@lexregia.com> wrote:
Tam wrote:
1. A trust is not an entity.
That is incorrect. A living trust may not be TAXED as an
entity, but it IS a separate entity from the grantor and
trustee, even if the same.
Not as a matter of common law.
A corporation has an existence that is separate from both the
shareholders and the directors of the corporation, but a trust
has no legal existence separate from the trustee (or trustees).
If that were the case, when a trustee dies the trust must terminate.
The rule, however, is that if a trustee dies and no mechanism to
select another is provided, a court can select a trustee, and the
trust can continue its existence.
This is a legal newsgroup. When I write something, like "a trust is not an
entity" I write that without a disclaimer or conditional phrase because it
is true and I know it to be true. If you think of the history of trusts
dating back to the Crusades you will understand the principle, and I don't
see why I should offer cites to the treatises on my bookshelf to prove
something so obvious to a law student.
A trust may or may not terminate upon the death of the trustee. Usually
there is a successor trustee, either under the instrument, or by appointment
(by a protector, by a probate judge, by the previous trustee...) That has
nothing to do with whether a trust is a separate "entity" or not.
And don't be fooled by tax law. Tax law is not intended to be logical, and
it isn't. It is intended to raise money.
|
| |
| |
Dan Evans wrote:
Whether a trust is an "entity" really has significance in only two
contexts that I am aware of:
1. Who can be sue or be sued? Technically, a trust cannot be sue or
be sued, but the trustee can. (Even though, if trustees are sued,
they may have no personal liability beyond the trust assets.)
Well -- how is this different than a corporation, except in the
NAME of the defendant.
--
This account is subject to a persistent MS Blaster and SWEN attack.
I think I've got the problem resolved, but, if you E-mail me
and it bounces, a second try might work.
However, please reply in newsgroup.
|
| |
| |
On 6/1/04 14:50, in article 5milvv8kmtshs3icnnbl7vukhf9vocpne1@4ax.com,
"Arthur L. Rubin" <ronnirubin@sprintmail.com> wrote:
Dan -- I'll have to take your word for it. But -- in the event
the trustee and beneficiary are NOT the same -- the trust assets
can (usually) be reached for debts of the beneficiary, not the
trustee.
That doesn't change the fact that in many or most states one must sue the
trustee and register land in the name of the trustee, not the trust. Some
states have changed this by statute, for convenience (and, perhaps,
privacy).
The trust is not liable for the debts of the trustee (as such), nor are the
trust assets part of his/her estate in bankruptcy or probate estate,
notwithstanding that title may appear "Joe Blow under trust deed dated (or
will of, etc.)
As for the assets being liable for the debts or taxes of the beneficiary,
that depends entirely upon the trust itself. The courts and legislatures
have meddled with the common-law rules; spendthrift trusts aren't
particularly safe anymore, but discretionary trusts are. And there are
dynasty trusts in jurisdictions that have abolished the rule against
perpetuities.
Of course if you go to a civil-law jurisdiction, they won't necessarily know
what to make of a trust (absent a statute or (like Italy) ratification of
the Hague Convention on Trusts) and might well treat it as an entity.
Finally, there are grantor trusts, a creation of federal tax laws. Treated
for some purposes as property of the settlor and others as vested property
of the beneficiaries (depending upon the trust terms).
|
| |
| |
On Thu, 08 Jan 2004 14:29:49 -0500, "Arthur L. Rubin"
<ronnirubin@sprintmail.com> wrote:
Dan Evans wrote:
Well -- how is this different than a corporation, except in the
NAME of the defendant.
The word "may."
Not too long ago, the EPA took the position that, when a trustee owned
real property with CERCLA "Superfund" environmental cleanup liability,
the trustee was PERSONALLY liable, and the liability was not limited
to the value of the trust assets, because hornbook law stated that the
trustee was the "owner" and federal law said that the "owner" was
liable without any showing of fault. And several courts agreed.
Congress had to change this result by statute, limiting the liability
of trustees as owners to the value of the trust property.
However, the experience left many institutional fiduciaries very
gun-shy of any property that might have any environmental problems.
**Dan Evans
**I post information, not advice.
|
| |
| |
Tam wrote:
Finally, there are grantor trusts, a creation of federal tax laws.
Now THAT is wrong. Grantor trusts are treated as non-grantor trusts,
except they are regarded as being the grantor or beneficiary for
income tax purposes. (Which one depends on the precise wording
of the trust, if the grantor and beneficiary are different.)
--
This account is subject to a persistent MS Blaster and SWEN attack.
I think I've got the problem resolved, but, if you E-mail me
and it bounces, a second try might work.
However, please reply in newsgroup.
|
| |
| |
|
