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Trusts are very flexible and are often used in estate planning. Trusts can be used for asset protection, gift and estate tax planning, avoidance of probate, charitable purposes, holding life insurance, providing for minors and special needs, and for numerous other purposes. The attorneys at St. Johns Law Group are experienced in handling issues regarding many different types of trusts and can help you determine the appropriate trust document for your needs.
WHAT IF THERE IS A REVOCABLE TRUST?
(Compliments of The Florida Bar)
If the decedent had established what is commonly referred to as a “Revocable Trust,” a “Living Trust” or a “Revocable Living Trust,” in certain circumstances, the trustee may be required to pay expenses of administration of the decedent’s probate estate, enforceable claims of the decedent’s creditors and any federal estate taxes payable from the trust assets.
The trustee of such a trust is always required to file a “Notice of Trust” with the clerk of the court in the county in which the decedent resided at the time of the decedent’s death. The notice of trust gives information concerning the identity of the decedent as the grantor or settlor of the trust, and the current trustee of the trust. The purpose of the notice of trust is to make the decedent’s creditors aware of the existence of the trust and of their rights to enforce their claims against the trust assets.
All of the tasks which must be performed by a personal representative in connection with the administration of a probate estate must also be performed by the trustee of a revocable trust, though the trustee generally will not need to file the same documents with the clerk of the court. Furthermore, if a probate proceeding is not commenced, the assets comprising the decedent’s revocable trust are subject to a two-year creditor’s claim period, rather than the three-month non-claim period available to a personal representative.
The assets in the decedent’s revocable trust are a part of his or her gross estate for purposes of determining federal estate tax liability.