A living trust (often called as Revocable Living trust or Family Trust) is a legal document that holds title or ownership to your assets or real estate property. By creating a living trust, you are just providing the trust the ownership of your assets. However, when you transfer title or ownership, you do not renounce any control. You can still buy, sell, borrow or transfer.
Advantage of Living Trusts in Washington
The main advantage of preparing a living trust in Washington is eliminating the expense and delay of probate court proceedings from the shoulders of your family after your death. But do you really need a trust?
Actually, in Washington, if you have a small estate (under $100,000) and you die, the probate process will be simple, straightforward and relatively inexpensive. So if your estate is smaller than this amount, you should not worry.
A Will is still needed in Washington
Though you may have a living trust, you always need a Will. A Will serves the purpose of a backup arrangement for any estate that doesn’t make it into your trust. For instance, if you acquire a property but don’t show it in your trust before your death, that property won’t be treated under the terms of the trust document. If you don’t have any Will, any property that is not included in your trust document will go to your closest relatives as determined by Washington state law.
Living trusts and estate tax in Washington
Often people ask if writing a living trust reduces estate tax in Washington. This completely depends on the kind of trust you create. If it is a simple probate-avoidance living trust, then there should be no effect on federal estate tax. However, like AB trust, there are a few more complicated living trusts those can reduce the federal estate tax bill for people who own many valuable assets.
Preparation of living trusts in Washington
Follow the steps mentioned below to prepare a living trust in Washington: