The Myths of a Living Trust
October 30, 2018
Hi, my name is Jim Horchak and I’m here today with another addition of Legal Tip Tuesday. And today I want to talk about the myths of a regulable living trust. And the first myth is that by having a regulable living trust, avoids inheritance tax compared to if I just had everything in my will, and that is completely false. Your estate will be subject to an inheritance tax whether or not you have a living trust or if you have a will. So, a living trust does not avoid inheritance tax. And the second myth is my probate cost will be reduced, and that also is not true.
If you have a living trust, you’ll still have to hire a lawyer – well your estate will have to hire a lawyer. There’ll still be probate cost at the courthouse. There’s a lot to do if you have your assets in a will or if you have your assets passing through a trust. So, there’ll be cost to pay either way, so that myth is simply not true. Another thing you have to think about is you still need a will, because what if you had some assets that you acquired after you drafted the trust and forgot to transfer them into the trust.
So you’ll need a will that picks up some of these assets that simply weren’t tilted in the trust, and again you may have to occur the probate process which in Pennsylvania isn’t that burdensome. When we talk to our clients, we most the time if not all the time, recommend wills. If you have any questions about living wills or trust, just give us a call here at the firm. Thank you.