Funding Your Living Trust


Signing a living trust isn’t the end of the estate planning process. You also need to fund a trust. Knowing how to fund a living trust is vital for the trust to accomplish its goals.

Funding a living trust involves transferring property to the trust. An asset not transferred to the trust is not owned by the trust and will be subject to probate (unless you’ve used another technique to avoid probate). In short, if there is no living trust fund, there is no living trust. How to fund a trust varies depending upon the nature of the property. You can transfer ownership, or, in some cases, designate the trust as a beneficiary upon your death.

  1. Transfer Real Estate

Transferring real property to a trust requires a deed, typically a quit claim deed.

A Lady Bird Deed is included with a complete Estate Plan package from T.L. Morson and Associates, PLLC. 

  1. Transfer Titled Personal Property

If personal property has a title document (cars, trucks, motorcycles, RVs, ATVs, boats, airplanes), it will be necessary to obtain a new title showing the living trust as the owner. In some states you can designate your trust as a beneficiary on a motor vehicle title, which keeps the vehicle in your name, but automatically transfers it to the trust upon death.

Caution: Find out if transferring ownership will result in substantial taxes or fees. If the vehicle is subject to a lien, get the approval of the lender. Also, ask your insurer if a transfer will affect your premiums.

  1. Fund Untitled Personal Property

Personal property without a title document (furniture, books, jewelry, tools, collectibles, etc.), can be transferred with an assignment of ownership document, which must be signed and dated.

It is important to adequately describe the property, so that there is no doubt about its identity.

  1. Transfer Bank Accounts

Bank Accounts should be retitled in the name of the trust.  This generally requires providing a copy of the certificate of trust and the signing of new banking documents.

  1. Fund Securities

Brokerage accounts much like bank account need to be retitled in the name of the trust.  This is generally accomplished by providing a copy of the certification of trust and new brokerage account paperwork.

  1. Transfer Business Interests

Interests in partnerships and LLCs, and shares in a corporation, can be retitled in the name of the trust. Check the partnership agreement, LLC operating agreement, or articles of incorporation, for transfer restrictions or procedures.

  1. Change Life Insurance Beneficiaries

Your trust can be the owner and/or the beneficiary of a life insurance policy. Making the trust the owner allows the trustee to manage the policy in the event you become mentally incapacitated, such as borrowing against the policy to obtain funds for your care.

Caution: In many states the cash value of a policy is exempt from creditors, but only if it is owned by the individual. Protection against creditors may be lost if ownership is transferred. Instead, you could use a power of attorney to allow someone to manage the policy.

  1. Transfer Royalties, Copyrights, Patents, and Trademarks

Whoever pays the royalties can advise you what is required to transfer the interest to your trust. Consult the United States Copyright Office for copyrights, and the United States Patent and Trademark Office for patents and trademarks.

  1. Gas, Oil, and Mineral Rights

The nature of these rights varies. If the rights are part of property you own, you can use a deed. If you own rights in property you don’t own, or have a lease or royalty agreement, an assignment of rights document will be necessary. Contact whoever pays you to learn what will be required to make the change. The document may need to be recorded. This is a complicated area, so you may want to consult an attorney.

  1. Accounts Receivable

An assignment of rights—a legal document changing who has the right to a debt – can make your trust the recipient of payments received on loans you have made to anyone (such as an unsecured personal loan or a loan secured by a mortgage).

  1. Making The Trust as Beneficiary

Some assets may not be transferred to a trust, but you may be able to make the trust the beneficiary upon your death. These assets include:

  • Retirement Accounts. Do not retitle any qualified retirement account, such as IRAs, 401(k)s, 403(b)s, or qualified annuities, including those in brokerage accounts. This will be considered a withdrawal of the funds, subjecting them to income tax and maybe penalties. Instead, change your beneficiary designation. Whether your trust should be the primary or secondary beneficiary depends upon your situation and tax laws.
  • Medical Savings Accounts (MSAs) and Health Savings Accounts (HSAs). Your trust should be designated as either the primary or secondary beneficiary (like a qualified retirement account).

By transferring your assets into your living trust, you bring them under the legal protection of this powerful estate planning tool. Once the trust is funded, the assets it holds will be protected from probate in most cases and offer your family peace of mind.

COVID Round Three

COVID round three. And cases spike across the nation for the third time this year.  Cases continue to grow and state are struggling to provide care. Unfortunately, the spread this time is from coast to coast and far worse than the spikes experienced in the Spring and Summer.  With COVID round three close to 250,000 Americans have lost their lives to this deadly virus with that number expected to exceed 300,000 before all is said and done. The unprecedented loss of life is expected to exceed that of all the wars fought by this nation combined. Unfortunately, the worse is yet to come.

Exciting news from pharmaceutical giants Pfizer and Moderna about the development of vaccines that could start arriving as soon as December has provided a glimmer of hope for the nation.  This exciting news is tempered, however, by forecast that the vaccine will not be available to the vast majority of Americans until the late Spring, early Summer barring any delay in the distribution.  Some states have starting to institute restrictions in an effort to avoid shutdowns that have devastating economic and social effects.

Covid round three

Estate Planning Check-up

Now more than ever is the time to start or revisit your estate planning needs.  Estate Planning is more than just a Will or Trust.  Estate Planning is a comprehensive plan that evaluates all aspects of your Estate, Tax, Life Insurance, and succession planning needs.  Failing to plan in one area can have dire consequences in others. An Estate plan is not for the living, it’s for the ones we leave behind.

At T.L. Morson and Associates, with over 25 years of experience, we are uniquely qualified to handle all aspects of your Estate Planning needs.  Life can change in the blink of an eye, call today for your free consultation.

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Change with The Times

Life can and often does change in the blink of an eye.  Whether you’re planning a wedding of starting your family it’s essential that your Estate Plan change with your life.  So, if you’ve recently married, divorced, started a new business, or purchased your dream home, reviewing your Estate Plan today can save your loved one’s time and money tomorrow.

So, Estate planning is not just for the wealthy. Good estate planning is often more impactful for families with modest assets because the loss of time and money as a result of poor estate planning is more detrimental.

A will provides your instructions, but it does not avoid probate and will only direct how your assets are devised. The assets must still go through your state’s probate court before they can be distributed to your intended beneficiaries. The process varies greatly from state to state, but it can become expensive with attorney’s fees, executor commissions, and court costs. It can also take anywhere from a few months to two years or longer. In most cases probate proceedings are open to the public, and your creditors and any excluded heirs are notified of their opportunity to file for payment of a debt or a share of your estate. In short, the court system, not your family, controls the process.


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Trust of Will ?

Estate Planning Document

Deciding whether to draft a Trust or a Will is an individual decision and should be made on a case by case basis with an Estate Planning expert.  Here are some facts about both Trust and Wills that may help make your decision a bit easier.

Compare and Contrast

Yes, most of my clients with larger estates select a Trust over a Will as part of a complete estate plan. Wills, however, can be an excellent fit for the right client.  Some of the reasons include:

  • Trusts bypass probate.  Probating an estate is not as expensive as some people make it out to be.  The overall cost varies greatly depending on the jurisdiction, size, claims, and whether challenges are made.  Drafting a Trust allows you to select successor trustees, either individuals or corporate to carry out the terms of your Trust.
  • Trusts are not public.  Probate is a public process.
  • Wills are used to devise an estate.
  • Trusts also devise an estate; however, Trusts provide the Grantor greater flexibility and control.  Trust give the Grantor has the ability to “pull strings” from the grave. This means the Grantor may set terms as to how assets are devised to their beneficiaries.  For example, the Grantor may state that 50% of a beneficiary’s inheritance is payable immediately and the remaining 50% is payable after she graduates from college.
  • Trust are used for Estate tax planning for larger estates.
  • Size matters – for individuals with smaller estates a simple Will may do the trick.  Establishing Transfer of Death Agreements for bank and brokerage accounts allow assets to transfer by operation of law to beneficiaries thus bypassing the probate process.
  • Cost – the cost of drafting a Trust can be more than twice that of drafting a Will.  Though drafting a Trust is more expensive upfront, the added cost of probating a Will could significantly reduce the cost difference.

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What COVID -19 has Taught US

What COVID -19 has Taught Us About Estate Planning? So, as the COVID-19 Pandemic sweeps its way across the United States, over 50% of all Americans still do not have an estate plan. This has struck a resounding alarm.  But, most people recognize the importance of planning their estate. However, most people also believe that they have plenty of time and that estate planning is something that they should do much later in life.  But, the fact is that estate planning is relevant at all stages of adult life, regardless of age.


An estate plan is not just for the living,  an estate plan is mainly for the loved ones we leave behind.  Dying without a Will or Trust means that you have left important decisions for the court to decide which may be contrary to your personal wishes.  Who will care for your children? Where will they live? How will their college needs be met?  These are all questions that a complete estate and financial plan can help address.

Tomorrow is not promised to any of us.  An estate plan can range from simple to quite complex depending on your particular circumstances.  The average estate plan can cost from $500 – $2,000 and can be completed in as little as a week. A comprehensive Estate Plan will include a Trust, Will, Powers of Attorney for health and finances, HIPPA agreement and more. All plans are tailored to your specific needs.  Life can change in just the blink of an eye. Don’t leave your loved ones unprotected. So, What COVID -19 has Taught Us About Estate Planning? Take care of the ones you love the most. Call Today to schedule your free no obligation consultation.

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Take care of the ones you love the most

For the ones you love

In the Blink of an eye life can change forever. Estate Planning is not only for you, An Estate Plan is more for the ones we leave behind. Take care of the ones you love the most.

However, we know two things are certain; death and taxes.  Despite these uncertainties, over 50% of people fail to plan for the inevitable. Because of this failure, a countless number of estates find themselves in the time consuming, expensive, and public process known as Probate.

Estate Plan is one of the most important and thoughtful decisions you can make. The purpose of an Estate Plan is not just to tell the government how to distribute property after your death. An Estate Plan is a way to maintain control over your affairs while alive and after you pass away. So, an Estate Plan allows you to protect your assets and help you and your family maintain your current lifestyle.

The amount of planning required will vary from client to client.  The objective of any Estate Plan is to transfer wealth to the next generation in the most tax efficient way possible.

At T.L. Morson and Associates we specialize in Estate Plans and Wealth Transfer Plans that are customized to meet the needs of each client.  This means our plans are designed specifically for you and the needs of your family.

Take care of the ones you love the most. Call Today for your free no obligation consultation.

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