Probate is the legal process through which a deceased person's assets are distributed. It involves validating the will, if one exists, paying debts and taxes, and distributing the remaining assets to heirs or beneficiaries. Probate can be a lengthy and costly process, which is why many people use living trusts to avoid it.

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How do I transfer a CD into my mother's living trust?

How do I transfer a CD into my mother's living trust?

Q: Can I add assets to a living trust after the trust creator has died?

No, you cannot add assets to a living trust after the trust creator has passed away. Once the creator dies, the trust becomes irrevocable, and any assets not previously included in the trust will need to go through probate to be distributed according to the will or state laws.

Full question:

My mother recently died and left everything in a Living Trust with the exception of a CD, which is less than 20 K. I am unclear on how to proceed with getting this CD into the trust. Thank you!Best,Susan Hunsaker

Category: Trusts
Date: 04/07/2025
State: Arizona

Answer:

A living trust is established during a person's lifetime to manage their assets for estate planning. It is not created after death. Assuming your mother created the trust before she passed, it holds the property managed by a trustee for the benefit of named beneficiaries, often including the creator of the trust.

Upon the death of the trust creator, the assets in the trust do not go through probate but are distributed according to the trust's provisions. However, any assets not included in the trust before death are not part of it and are subject to probate laws.

In your case, since the CD is not in the trust, it will go through probate unless the total estate value (excluding the trust assets) is under $75,000. If it is, you can petition the probate court for small estate administration.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

What happens to assets not included in a living trust after death?

Assets not included in a living trust before the owner's death typically go through probate. This process involves the court overseeing the distribution of these assets according to state laws or the deceased's will. If the total value of the estate, excluding trust assets, is under a certain threshold (often $75,000), you may be able to file for small estate administration to simplify the process.

Can I add assets to a living trust after the trust creator has died?

What is a small estate administration?

Small estate administration is a simplified probate process available for estates that fall below a certain value limit, often $75,000. This process allows heirs to access assets more quickly and with less court oversight than traditional probate. It typically involves filing a petition with the probate court to claim the estate's assets.

What is the role of a trustee in a living trust?

A trustee is responsible for managing the assets in a living trust according to the trust's terms. This includes overseeing the distribution of assets to beneficiaries, handling financial transactions, and ensuring that the trust complies with applicable laws. The trustee acts in the best interest of the beneficiaries and must follow the instructions laid out in the trust document.