Full question:
Regarding a Revocable Trust: Grantors name themselves as Trustees, their daughter as beneficiary, transferring real estate property, a motor vehicle, a motorhome & stock(as assets) into the trust. Question: Who now is the owner(s) of those assets?
- Category: Trusts
- Subcategory: Revocable Trusts
- Date:
- State: South Carolina
Answer:
Once the assets are transferred into the trust, they belong to the trust itself, not to the trustees. The trust operates under the rules set out in the trust document. Essentially, a trust represents a property right held by one party (the trustee) for the benefit of another (the beneficiary). In this case, the grantors, who are also the trustees, maintain control over the assets while managing them for the benefit of their daughter, the beneficiary.
To establish a living trust, the grantor must create a declaration of trust, which outlines the terms of the trust. The grantor names themselves as the trustee and transfers assets into the trust. This process is called funding the trust. For real estate, a deed must be executed that names the trust as the grantee. Other assets, like bank accounts and vehicles, can also be transferred to the trust.
While the grantor is alive, they manage the trust assets. However, the beneficiary does not receive any benefits until the grantor passes away. At that point, a successor trustee takes over and distributes the trust property to the beneficiaries without going through probate. Assets not included in the trust may still be subject to probate after the grantor's death. Therefore, it is advisable for the grantor to have a pour-over will that transfers any remaining property into the trust upon their death.
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.