How to Properly Plan Your 'Total' Estate with a Living Trust, Without the Lawyer's Fees : The National Living Trust Kit

by Anosike, Benji O.

• ISBN13: 9780932704542
• ISBN10: 0932704549
• Edition: Revised
• Format: Paperback
• Copyright: 2001-02-01
• Publisher: Do It Yourself Legal Pub

Summary

Offers sample forms and worksheets for preparing a living trust, will, and other documents for estate planning.

Table of Contents

Foreword: The Publisher's Message	i
How to Use This Manual	1	(1)
Introduction The Living Trust as One Primary Tool in a ``Total'' Estate Plan Scheme
The Purpose or Purposes of Estate Planning	2	(1)
Different Tools Are Used To Achieve Different Estate Planning Objectives	2	(1)
The Estate Planning Tools & Devises Primarily Considered in This Manual	2	(1)
The Fundamental Philosophy of Estate Planning in This Manual: Use of the Trust in Combination with Other Tools in a ``Total'' or Complete Estate Plan Scheme	3	(1)
Let's Get the Background Information Straight First: The Trust Basics
What is a Trust?	4	(1)
The `Living Trust' Versus the `Testamentary Trust'	5	(1)
Trusts May Be Created For Just About Any Purpose	5	(1)
The Many Advantages of the Living Trust	6	(3)
Probate Avoidance	6	(1)
Flexibility: It Can Be Designed For Income & Inheritance	6	(1)
Professional Management of Assets	6	(1)
A Trust is Far Less Subject to Court Contest or Challenge	6	(1)
Trust Property is Less Subject to Attachment	7	(1)
Trust Allows for Quicker, Almost Immediate Payout of Inheritance to Beneficiaries	7	(1)
It Maintains Confidentiality & Privacy of Affairs and Records	7	(1)
Ability to Change Provisions as Often as Desired	7	(1)
Centralization of Management	7	(1)
Virtually Any State Can Be Your `Home' State	7	(1)
Ability to Test Out Your Trust Provisions or Management While You're Alive	7	(1)
Tremendous Savings in Administrative and Probate Costs & Expenses	8	(1)
Some Common Myths About Trusts	9	(2)
That Only Wealthy People Need to Have a Trust	9	(1)
That With a Trust, You Lose Control of Your Property	9	(1)
That With a Trust You Can totally Avoid Taxes	9	(1)
That You Can Avoid Probate With Any Kind of Trust Whatsoever	9	(1)
That You Can Use a Trust to Avoid Paying Your Legitimate Debts	9	(1)
That Everyone Should Have a Trust	9	(1)
That If You Have a Trust, You Don't Need a Will	10	(1)
The Primary Estate Planning Reason Why You Should Have a Revocable Living Trust: To Aviod Probate
Should You---Must You---Have a Living Trust & Why?	11	(1)
Why Avoid Probate?	11	(1)
Now, The Good News: You Can Easily Avoid The Dreaded Agony of Probate By Simply Having a Living Trust	12	(3)
Other Probate Avoidance Methods of Transfer Used in Estate Planning, and When They May Just Be the Proper Tools for You
The Trust Is By No Means The Only Method for Probate Avoidance Available	15	(1)
Major Other Methods For Avoiding Probate	15	(3)
Jointly Held Property	15	(1)
United States Bonds	16	(1)
Life Insurance	16	(1)
Employment Benefits, Pension Fund and Death Benefits	16	(1)
Pay-on-Death Bank Accounts (The Totten Trust)	17	(1)
Life-time Gift Making	17	(1)
The Living Trust Device May Not Suit Every One Or Every Situation	18	(2)
Some Specific Situations When The Living Trust May Not Necessarily Be The Best Device	20	(4)
Simplified small estate category of people	20	(1)
When you already have your property in other probate avoidance forms that are as effective	21	(1)
When you may just be too young or own so little property to need a trust	22	(1)
When a Will, and not a trust, may be all you really need because of your special needs	23	(1)
The Concept Of `Total' Estate Planning Approach	24	(1)
A Prudent General Principle of Estate Planning: Employ Particular Probate Avoidance Tool Or Tools Depending On Each Individual's Needs And Situations	25	(1)
Major Factors You'll Have to Consider and Decide on in Establishing a Living Trust
Basic Trust Terminology	26	(2)
The Grantor	26	(1)
The Trust Res	26	(1)
Per Capita	26	(1)
Per Stirpes	27	(1)
Blood or Adopted (Child)	28	(1)
Issue	28	(1)
The Essential Elements and Formalities of A Living Trust	28	(1)
Creator's intent in creating the trust	28	(1)
Picking out specific property or assets to put in the trust	28	(1)
Having a valid purpose for a trust	28	(1)
Choosing and naming a trustee	28	(1)
Name more than one beneficiary	28	(1)
Identify the trust with a federal I.D. number, if necessary	29	(1)
The Trust Team	29	(6)
The trustee	29	(1)
The back-up or successor trustee	30	(1)
The Ideal Qualities to Look for in a Good Back-up Trustee	30	(2)
Alternate back-up trustee	32	(1)
A final point on picking a trustee or back-up trustee	32	(1)
The beneficiaries and alternate beneficiaries	32	(1)
The spouse	32	(1)
The children's trust, if appropriate	33	(1)
Appointment of a children's guardian	33	(2)
Allocation And Distribution Of Assets	35	(4)
When, exactly, is the specified inheritance to be distributed?	35	(1)
In what form is the distribution to be made?	35	(1)
Allocation to children	35	(1)
Distribution of income or assets?	36	(1)
Per capita or per stirpes distribution?	36	(1)
Possibility of divorce & inheritance in the midst of divorce	36	(1)
Providing for loans for older children	36	(1)
Providing for special needs of children	36	(1)
Gifts to charities	37	(1)
What kind of living trust to create	37	(1)
Disinheriting someone	37	(1)
Pets as beneficiaries	37	(2)
The `A-B' or `A-B-C' Types of Living Trust: How to Reduce Your Federal Estate Taxes if You are in a `Large' Estate Bracket
Tax Reduction Or Minimization As An Estate Planning Objective	39	(1)
Income Taxes As Compared To Death Or Estate Taxes	39	(1)
Income Taxes	39	(1)
Estate and inheritance taxes (``Death Taxes'')	39	(1)
What Is Your `Net' Estate Worth?	40	(1)
The Marital Deduction Provision	41	(1)
An Estate Tax-Saving Solution: The A-B Living Trust	42	(1)
What Is An A-B Trust?	42	(1)
Here's How The A-B Trust Works In Practice	43	(1)
Summary Of The Advantages of A-B Living Trust	44	(1)
Estate tax savings	44	(1)
No probate fees or expenses	44	(1)
Assures control of one's property, and that one's wishes as to inheritance will be fulfilled	44	(1)
Protection of assets in event of catastropic illness	45	(1)
Usable to make provision for income and maintenance for surviving spouse	45	(1)
Appreciation in value of assets in trust B is estate tax-free	45	(1)
Estate Tax Savings Realizable by Use of A-B Living Trust, As Compared To Use Of Will Or A Regular ``A'' Type Of Living Trust	45	(2)
Some Disadvantages Of The A-B Trust	47	(2)
Lack of flexibility or complete control of trust assets	47	(1)
Problems associated with income taxes and estate taxes	48	(1)
Complexity: it requires major considerations and determinations	48	(1)
Concern about effect of the living trust in case of a divorce	49	(1)
The A-B-C Trust	49	(2)
The Three Types of Living Trusts: Who Should Use The ``A'', The ``A-B'', Or The ``A-B-C'' Trust?	51	(1)
The ``A'' Trust	51	(1)
The ``A-B'' Trust	52	(1)
The ``A-B-C'' Trust	52	(1)
Here's How The A-B-C Trust Works In Practice	52	(2)
Summary Of The Advantages Of The A-B-C Trust	54	(1)
The Estate Information Organizer Worksheet	55	(178)
Let's Draw Up the Trust Creation Papers: The Step-By-Step Procedures
Some Helpful Practical Procedures For Working Out A Good Living Trust Plan	63	(1)
Some Relevant General Information For Drafting The Papers	64	(1)
Drawing Up The Trust-Creating Document: The Declaration Of Trust	65	(2)
Which one of the three forms of living trust do you need?	65	(1)
By what state rules to be governed	65	(1)
Let's actually complete your living trust declaration form	65	(1)
What to do when you've completed making up the draft copy of your declaration of trust	66	(1)
You've got to sign and notarize your declaration document before a notary public	67	(1)
Next Order Of Business: Transfer The Trust Property Into The Trust	67	(6)
The extreme significance of actually transferring the trust property into the trust	67	(1)
How much of your total wealth & property do you put in the trust?	68	(1)
General practical principles of transferring property	68	(1)
property having no documents of ownership	69	(1)
Property that generally have documents of ownership	69	(1)
Here's how to transfer specific trust assets	70	(1)
safe deposit boxes	70	(1)
business interests	70	(1)
corporations	70	(1)
sole proprietorships	70	(1)
partnerships	70	(1)
transfer of real property	70	(2)
transfer of bank, brokerage and financial accounts	72	(1)
transfer of securities or stock market or mutual fund accounts	72	(1)
transfer of motor vehicles	73	(1)
transfer of other real assets having documents of title	73	(1)
A Final Word On The Transferring Of Property Into The Trust	73	(1)
Form LT-I, Declaration of Trust - A Sample Form for An ``A'' Trust	74	(6)
Form LT-II, Declaration of Trust - A Sample Form for An ``A'' Trust	80	(10)
Form LT-III, Declaration of Trust - A Sample Form for An ``A-B'' Trust	90	(11)
Form LT-IV, Declaration of Trust - A Sample Form for An ``A-B-C'' Trust	101	(9)
Forms---sample forms for transfer of property to the trust	110	(11)
The Operation of the Trust, Revocation of the Trust, & Settling of the Estate
To Change The Trust Property Or Beneficiaries	121	(1)
Substitution Of a Trustee Or Successor Trustee	121	(1)
Assumption Of Authority By Successor Trustee	121	(1)
Revocation Of The Living Trust By The Grantor	122	(2)
Revocation of the trust simply to end it	122	(1)
Voluntary termination or revocation of the trust and transfer of trust property back to oneself	123	(1)
Sign the revocation and transfer documents and record them, if applicable	123	(1)
Involuntary Termination or Revocation Of Trust And Transfer Of trust Property To Beneficiaries Upon Surviving Grantor's Death	124	(2)
Successor trustee signs the transfer documents, and records them, if applicable	125	(1)
Forms -- Sample forms for transfer of property to trust beneficiaries	126	(14)
A Few Extra Estate Planning Instruments You Should Have for a `Total' Estate Plan Protection
The extra tools we shall consider in this chapter	140	(1)
Back-up, Pour Over Will - a sample form	140	(1)
The Living Will	140	(1)
Durable Financial and Medical Power of Attorney	140	(1)
Drawing Up The Back-up or Pour-over Will	140	(2)
``Execution'' (Signing) of the Will---the procedures	141	(1)
The Living Will	142	(1)
Drawing Up The Durable Financial and Medical Power of Attorney	143	(2)
Execution (signing) of the Living Will and/or Durable Power of Attorney	145	(2)
How To Revoke Your Living Will and/or Durable Power of Attorney	147	(1)
Forms---sample forms for Back-up Will, Living Will & Durable Power of Attorney	148	(11)
The Settling of Your Trust Estate: Here's How You must Organize Your Estate Now, or Your Trustee Still won't be Spared the Agony of Probate Later!
Having The Living Trust Is Not Enough; To Complete The Circle, You Must Organize Your Estate Also	159	(1)
Use of the Estate Information Organizer Worksheet And the Final Operational Instructions For Settling. The Estate	160	(1)
General Instructions On Completing The Two Forms	161	(1)
``The Estate Records Book' Binder	161	(2)
Form LT-102---Sample Form of ``The Final Operational Instructions To The Trustee/Successor Trustee For Settling The Estate''	163	(2)
Trustee's Checklist of Duties	165	(6)
Some Few Other Estate Tax-Saving Tools You May Consider, To Supplement Your Living Trust
Other Tax-Saving Devices Beyond The A-B or A-B-C Trust	171	(1)
Life Insurance: An Overview	171	(1)
The Purposes for Having Life Insurance	172	(1)
Who Really Needs To Have Life Insurance	172	(1)
What Is The ``Right'' Amount Of Life Insurance	173	(2)
But Here's the Even Bigger Problem: Can You Afford It?	175	(1)
Using the Irrevocable Life Insurance Trust As A Device for Estate Tax-Saving	176	(9)
Situation when using this special kind of Life Insurance may be advisable	177	(2)
How to set up your life insurance trust	179	(1)
Can You live with the restrictions and other terms?	180	(1)
To set up a life insurance trust, simply follow the following procedures, step-by-step	180	(1)
How to fund the Insurance Trust	181	(4)
Using Lifetime Gift-Making As an Estate Tax-Saving Device	185	(2)
The advantage of this Method	185	(1)
Major Disadvantages of this Method: Can You Really Afford to Permanently Part with the Gifts?	185	(1)
What are the consequences if you give a gift worth in excess of $10,000?	186	(1)
APPENDICES
A. Summary of the Basic Trust Rules & Requirements in All 50 States & Other Jurisdictions	187	(24)
B. Schedule of Trust Assets	211	(3)
C. Look, Chances Are You May Just Not Have An Estate Tax `Problem,' in the First Place	214	(10)
D. Glossary of Estate & Legal Terms	224	(6)
E. Some Relevant Bibliography	230	(1)
F. Ordering Your Blank Forms for Creating Your Living Trust Estate Plan	231	(1)
G. Publications From Do-It-Yourself Legal Publishers	232	(1)
Readers Opinion Sheet	233	(1)
Index	234