Revocable Living Trusts: What you need to know

In this episode we discuss Revocable Living Trusts, aka Inter-vivos Trusts or Living Trusts. We discuss the pros and cons revolving around Living Trusts. First thing to understand: 1. Revocable means it can be REVOKED! Thus you still own it, control it and pay tax on any income in it on your personal tax return. However, a Revocable Trust becomes IRREVOCABLE at death. Thus you better understand what your trust states because at your death it can only be changed by court order. 2. Who is the Successor Trusttee? This is the most important person in your trust document. Who manages it when you are incapacitated or death??? 3. Is your trust actually FUNDED, i.e., hold an asset? If your trust doesn't actually own an asset it's not worth the paper it's written on. YOu need to make sure you actually put a property into your trust. Not difficult to do for financial assets, like a bank account, but for REAL assets, like your home, that's more problematic.