Florida Living Trust

A Florida Living Trust, also known as a revocable trust, works in much the same way as a regular trust: through a written trust agreement, you (the grantor) form a trust and contribute assets to it, naming a trustee (either an individual or entity) to administer it pursuant to your instructions and for the benefit of the named beneficiaries. The trustee has a fiduciary duty to fulfill these obligations honestly and effectively.

A living trust is so named because as both the grantor and trustee, you maintain complete control over it for as long as you live. You can continue administering and using the assets in the trust during your lifetime, including adding or removing assets, amending the terms of the agreement, and even revoking the trust altogether. Only after you die does the trust become irrevocable – e.g., unalterable – and a successor trustee takes over to serve their function as specified in the agreement.

Aside from its adaptability, a Florida Living Trust offers a myriad of other benefits as an estate planning tool.

First, it offers privacy: unlike a will, a living trust does not need to be filed with the court or any other government authority, nor does it need to be recorded in the public records. It does not even require a tax identification number, so long as you, as the grantor, are still alive and serving as trustee. Thus, only the parties involved are privy to the trust’s existence or details. In order to come into full legal effect after your death, the living trust must be properly executed in the same manner as a will, such as by having two witnesses sign that they were present during your signing of the trust agreement.

Second, in the event that the grantor in some way becomes incapacitated, a living trust can lay out specific protocols for a successor to take his or her place as trustee for administering the trust assets. The living trust can provide specific details as to what constitutes incapacity and what the subsequent protocols should be. Thus, a living trust can safeguard your assets in a worst case scenario.

Third, a living trust helps keep your assets out of probate, the court-supervised process of administering your estate. Since the property in the living trust is not titled in your name upon death, but rather in the name of the trust, it does not fall under the purview of a probate court. Assets can be conveyed to your beneficiaries without the time, procedure, and associated costs of the court system. In fact, this benefit can extend even to properties located in other states, which will avoid their respective probate processes if listed in the same living trust.

Finally, a living trust can offer excellent asset protection for your beneficiaries. The inclusion of a “spendthrift” clause will restrict the beneficiary from accessing the assets except in the manner you specify. For example, you can arrange for a portion of the income from a rental property to go to the beneficiary monthly, rather than give them full use and ownership of property. This is ideal for beneficiaries whom you feel are not good with money or who otherwise can’t be trusted not to squander the assets. It also has the benefit of keeping creditors and claimants away, preventing the assets from falling into their hands at the expense of your beneficiaries.