The Law Office of Michael J. Howell, P.A.

Client Update

 Importance of Funding Your Revocable Trust

By Michael J. Howell, Esquire

Whenever we prepare Revocable Trust Agreements for clients, we remind them to take the steps necessary to fund their trust or trusts. We also suggest that clients provide us with information regarding each asset, showing that the asset has been placed into the trust. We also suggest that we meet with them to review the information to make sure that the funding was properly completed. Lastly, we let them know that we have closed our file and we are not going to do any further work unless or until requested.

This email is a complimentary service to you as a client. However, you may not receive any further follow up to this email, so it is imperative that you read it and consider the importance of its contents.

If you have a Revocable Trust as part of your estate planning and it is not fully funded prior to the date of your death, or certain disabilities, a probate procedure will likely be required either during life, at death, or both. These can be time consuming, expensive, and also stressful.

For these reasons, we strongly suggest that you fund your trust. It will not only make it easier for you in the event of death and/or disability, but also for your loved ones.

Also, note that annuities, IRAs, and pension benefits, if any, should not be made payable to your trust without prior consultation and approval from me, your CPA, or someone with similar credentials. These types of assets are often, but not always, paid directly to your beneficiaries. To be safe, you should have a letter or email from the person making the approval, in your file. You should not rely upon a verbal approval. 

Also, please keep in mind that Congress will likely enact a new law called the Secure Act, this year, which will have a substantial impact on planning for IRAs. For clients with large IRAs, they should come in and have their IRA planning reviewed in late January or early February of 2020, when we will know more about the impact of the new law.

For clients who have Revocable Trust Agreements, we also offer a trust funding review service. The conference is at our standard hourly rates. However, if you check our website, we offer a free one-half hour review.  If you go to: https://www.hiltonheadestateplanning.com/free-trust-funding-conf it explains the free one-half hour.

As part of this service, we review your titles, deeds, bank statements, brokerage account statements, and other evidence of ownership with you to determine if your trust is fully funded.  We also show you how the binder, which we may have already given to you, which helps you organize the information and also makes it easier to keep the information up-to-date. 

The binder will also make it easier for your family to find needed information in the event of an emergency, such as your death or disability. If you do not have a binder or you have lost it, we can provide you with another one.

Although we also offer trust funding services, most of the funding can be taken care of by you at a greatly reduced cost. It simply takes time.

One of the few matters that you should not attempt is the transfer of your real estate into trust. This is why, whenever possible, we write to your real estate attorney and ask him or her to contact you to prepare the necessary deed or deeds to transfer your real estate into trust. 

We also provide the real estate attorney with the trust information necessary to prepare the deed or deeds.

If your real estate has already been taken care of, you would have met with your real estate attorney and received the deeds after they were recorded. The recorded deeds will have the official recording information stamped on them showing the deed book and page number provided by the Register of Deeds Office as well as additional information. If you do not have this information, you should either contact your real estate attorney or set up a time to meet with us and we can follow up with your real estate attorney.

If you would like to meet with us, you need to gather the following information: your most recent brokerage account statements, bank account statements, beneficiary designations, and similar statements, for the conference. You also need to bring in a copy of your deed, copy of your title to any boats, airplanes, and/or automobiles, and all documents (copies only) should be in your binder. 

It will be helpful and more cost effective if the information is provided to us at least two business days prior to the meeting. However, please keep in mind that we should only be provided with copies of documents, not the originals.

Please note that if you have our binder with the index tabs and it has been kept up to date, the needed information will already be in it, and you can just drop off the binder with the information. If the binder has not been updated recently, this will be a good time to bring it up to date. We will review the binder with you during our scheduled meeting.

With respect to any assets with beneficiary designations, you should also have one that is no older than 2-3 years. If necessary, you should order written confirmation of who the current primary and contingent beneficiaries are. 

If you would like to review the funding of your trust, please call or email our office to set up a time to meet. 

Thanks,

Michael J. Howell

P.S. You have received this letter because, according to our file, we did estate planning work for you in the past.  If this is not correct, or we have emailed this information to the wrong person,  or if you have hired another attorney to take care of your estate planning work, or if you have moved out of state, or if you would otherwise like to be removed from our client mailing list, please let us know by a reply email so that we can take you off of our client mailing list.