A Living Trust in Michigan must meet various statutory rules in order to be considered effective and viable. If the rules are met, a trust can be an extremely powerful estate planning tool that gives you significant control over your assets while providing privacy and security. A Living Trust is a trust created by you during your lifetime to manage assets in the event of your incapacity or disability and provide structure after your death. Properly drafted, a Living Trust ensures you are able to tap in and use the trust assets while those assets are held inside the trust during the course of your lifetime. To put assets into the trust, you must first formally transfer ownership of the assets into your Michigan trust, which then enables them to be managed by the trustee.
Any person can serve as the trustee of your trust, but it is quite common in a Michigan Living Trust to name yourself as the initial trustee. You will also need to choose a successor trustee who steps in after you pass away. That trustee will continue to manage assets and distribute the assets to beneficiaries according to the terms of your trust. Most Living Trusts, including some Irrevocable Living Trusts, can be altered at any time you wish, which means they give both flexibility and control. Traditional Irrevocable Trust planning focused on estate tax planning, but today, a properly drafted Irrevocable Trust can protect your assets from lawsuits and long-term care costs.
Assets are often placed inside a Living Trust in Michigan because once you pass away, the assets can be distributed more quickly than those listed inside a will. Assets included in a Michigan Will must go through the probate process, which does not allow for efficiency of distribution. A Living Trust will also provide privacy in a manner that a Will going through probate court simply cannot. Finally, it is important to note that trusts are much more difficult to contest than wills. This makes it significantly more likely that your loved ones will follow through with the requirements and wishes you have laid out in a Trust and in a Will.
Before deciding whether you need a Living Trust in Michigan, you must consider your needs and the various benefits different types of trusts can provide. Need help getting started? Consult with a Michigan trust lawyer today.