Living trusts are a common estate planning tools used to accomplish various objectives. One of the main reasons people used living trusts is to keep certain property out of probate court or avoid the need to go through probate entirely.
North Carolina has a simplified probate procedure for small estates. If a living trust contains most of the decedent’s property and the remainder is less than the applicable threshold for small estates, the streamlined procedure can be used instead of the regular probate process.
Why To Consider a Living Trust
The main advantages of avoiding probate with a living trust are to avoid the time and expense of the probate process. Probate court is also a matter of public record, so avoiding probate is also a privacy concern for many individuals.
A living trust is not a substitution for a will. Any property that is not in your trust and is otherwise part of your estate will still go through the probate process. If your will does not provide for the distribution of this property, North Carolina’s intestacy laws will be used to determine who receives the property.
However, living trusts also provide certain advantages over wills. A living trust can provide a way to manage your affairs during periods of disability, while a will only determines who receives your property after death.
The Limits of Living Trusts
Trusts can be used to accomplish a variety of objectives, including:
- Giving you control over your assets after you pass away
- Reducing estate taxes
- Protecting assets from creditors
- Providing instructions on how assets should be used to benefit minor children
- Caring for special needs individuals
However, not every person needs to worry about each of these objectives. For example, estate taxes only impact a small percentage of decedent’s with very large estates.
It’s important to realize that living trusts are not a cure-all estate planning tactic. You may have heard claims that you can use living trusts for a variety of goals, but you should always check with a North Carolina estate planning to make sure you are setting up your estate plan properly.
When used as part of a comprehensive estate plan, living trusts can be a valuable tool in the estate planning toolbox.
King Law Offices is a full-service law firm with an outstanding team of professionals who work diligently, creatively and compassionately on behalf of our clients each day. We serve the Upstate of South Carolina and Western North Carolina. Call 888-748-KING (5464) today for a consultation.