By Harry J. Lenaburg,
Esq.
A
primary reason for individuals or couples to establish a revocable living trust
is to avoid the necessity of the filing of a probate to administer their estate
when they die. In such a trust the
settlors, they are the ones who establish the trust, instruct the successor
trustee on how to distribute the property.
I
am often asked what a pour-over will is then include in the trust package. There is a relatively simple reason for
this. First, you must understand that
the pour-over will direct that any assets not within the trust should be
transferred into the trust if a probate is necessary. When the trust is prepared it is funded by
the transfer of the settlors’ assets into the trust. Real property is titled to the trust, as well
as other assets such as investment accounts or other financial accounts.
Unfortunately
it sometimes occurs that an asset is forgotten, or perhaps there is an asset
that a settlor is unaware of, such as property, such as stocks, left to the
settlor by another, but not transferred in.
Another example I can cite is a home that was initially titled to the
trust. When the settlor desired to
refinance the home, the new mortgage company required that the home be
transferred back out of the trust. Once
the refinance was accomplished the settlor should have again transferred the
home into the trust. Unfortunately, that
step was neglected. The result was that
a probate action to transfer the home was required. The pour-over will then result in the property
being transferred back into the trust, for distribution according to the
settlor’s estate plan. The pour-over
will is not just another piece of paper.
An
experienced estate planning attorney can help you to get your estate plan in
order. You should consult with one
whenever there is a life changing event, marriage, birth, a windfall,
retirement or when you are unsure of what steps to take to protect you assets
and your family.
The
Law Firm of Jessica M. Cotter, P.L.L.C.
18301
North 79th Avenue, Suite F-168
Glendale,
Arizona 85308
602-843-3004
Jmcotterlaw.com
Jessica.Cotter@azbar.org
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