A living trust is supposed to help you avoid the hassle and expense of probate. Since Texas hasn’t adopted the Uniform Probate Code, it can be a messy process, and a living trust lets you transfer everything to named beneficiaries without it.
That raises the question of what things you transfer into your living trust account.
What Assets Can Go In A Living Trust?
Most items, from precious metals to bank accounts, can go in your living trust. Big assets and assets that you know you will keep for your lifetime are the best choices.
An important exception is your 401(k.) However, you can name your trust as a beneficiary of your savings plan.
One favorite item to put in trust is real estate. It’s probably the biggest asset you have, and putting a house through probate is a long process. Putting it in a living trust means that your named beneficiary gets the house much sooner and without losing money to probate fees.
Living trusts can absolutely hold your small business, and it is an excellent way to protect a company’s continuity. A sole proprietorship (a business that you run under your own name) can be put in a trust like your house and bank account.
You only need to change the partnership certificate to name your trust as an owner and put your shares in the trust in order to preserve your part in the business. You can treat a closely held corporation similarly.
You will have to get permission from the others in the company to put your share of an LLC in a trust. Once it is transferred, the trustee will be the one who votes on decisions in the business. If you’re the trustee, your business partners will probably be fine with this.
ProAdvocate Group has plenty of experience in deciding what a living trust should have, so contact us if you want more information on making one.