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Revocable Trusts in New York

What is a revocable trust?

This type of trust is a living trust that can be changed at any time. The terms can be modified for any reason by use of a trust amendment. These types of trusts are flexible and many think that all trusts should be this way.

Positives and Negatives to Revocable Trusts

There are downsides to revocable trusts because the assets involved are considered personal assets when it comes to creditor or estate tax purposes. This is a downfall because it means the assets in the revocable trust are not protected from creditors if you are sued. The assets are considered your own personal assets when it comes to Medicaid planning and when the time comes and you pass away, the assets are subject to estate taxes from the state and federal taxes along with state inheritance taxes.

There are many benefits to using revocable trusts as well. There are three reasons to use a revocable trust, including if you are:

  1. Planning for mental disability: If a person becomes mentally disabled, the assets in the revocable trust can be managed by their trustee rather than a court- supervised guardian
  2. Avoiding probate: The assets in the revocable trust avoid probate and go straight to the beneficiaries in the trust agreement
  3. Protecting the privacy of your property: When you avoid probate, the trust is a private document. The public cannot find out about your property or who you left your assets to. Last wills and testaments that are admitted to probate become a court record viewable by the public.

How is a revocable trust made?

A revocable trust comes about when a Trust-maker is alive and that individual will make a trust agreement with provisions allowing him or her to manage, capitalize, or use the assets in the trust. In the agreement there will be procedures for when/if the individual becomes mentally incapacitated. If the Trust-maker becomes mentally disabled, the "disability trustee" will take over the assets and manage the bills and finances of the Trust-maker. When the Trust-maker passes away, the "successor trustee" will then be put in charge of the assets and pay any bills or debts that the Trust-maker had. There are specific instructions in the revocable trust agreement dictating the division of the assets once bills have been paid and the trustee will be in charge of the distribution.

Do you need an estate planning lawyer for your revocable trust in New York?

If you are looking to create revocable trusts, it is important to have assistance from a knowledgeable estate planning lawyer from Melnik Law Group, PLLC. We offer a free initial consultation so you can call our firm today and ask questions or create a plan for your future with a New York estate planning attorney from our firm at no cost! Plan and protect your future by letting us help you!

Rockefeller Center 7th floor 1230 Ave. of the Americas New York, NY 10020
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Melnik Law Group, PLLC - New York City Estate Planning Attorney
Located at One Rockefeller Plaza, 10th Floor New York, NY 10020. View Map
Phone: (800) 517-5110