Category Archives: Q&A

What is the difference between a Warranty Deed and a Quit Claim Deed?

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By Trisha Applegate

A quit claim deed conveys or transfers whatever interest the Grantor (the person making the deed) has in the property, without making warranties about rights that other people may have in the property. It is usually used when granting land between two people who are well acquainted, such as between divorcing spouses or family members or to transfer your real property into a Trust.

In contrast, a warranty deed conveys title to a Grantee with a guarantee of good clear title to the property free from any interests held by other people. Warranty deeds are the traditional form of deed used in residential home sales between unrelated parties, as it provides a degree of protection to purchasers that the quit claim deed does not offer.

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person's situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.
The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement. If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

What is trust funding?

Screen-Shot-2013-01-30-at-8.55.45-AM8-300x2576By Carmen Potterton

People create trusts for a variety of reasons; to avoid probate, to protect a home from a nursing home spend down, to protect a child's inheritance from creditors/predators, etc. For a trust to fulfill its intended purpose, it has to be funded. Funding is the processing of changing ownership of assets (anything with a deed, title or account number) so that the rules of a trust apply to those assets.

To fund a financial account, such as a checking account, brokerage account or insurance policy to a trust, your financial institutions must be informed that you created a trust and that it is your desire to change the owner and/or beneficiary of the account/policy at that institution. This is accomplished by preparing a letter of instruction or completing company-specific forms that are sent the institution indicating the changes to be made. For example, you may indicate that the ownership of your bank account is to be changed from you personally to you as trustee of your trust. Along with the letter of instruction, most institutions also require specific pages from your trust that show the names of the creators of the trust, the date it was created, names of the current trustees and the successor trustees. In addition, a trust memorandum is also sent to show that the current trustee has the power to make the requested change of ownership or beneficiary.

Funding can be complex and, for most of us, should not be a do-it-yourself project. Make sure that your attorney includes funding all of your assets to your trust(s) as part of your fee. The attorneys at Cooper, Adel & Associates fund the trusts we prepare for our clients. We would be happy to do the same for you. Give us a call if we can assist.

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person's situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.
The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement. If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

Do I have to legally value my assets as they go into the living trust?

Screen-Shot-2013-01-30-at-8.55.45-AM8-300x2576Answer:  No.  There is no reason to legally value your assets as you place them into your living trust.  It is helpful, however, for you to have an understanding of the value of your assets so that you can properly plan strategies to reduce estate taxes. 

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

How are new assets placed into my living trust after it is created?

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Answer:  New assets are placed into your name as trustee of the trust in the same manner as when you created the trust.  For example, if you buy a new CD, the CD should be titled in your name as trustee of your trust. 

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Should I put IRAs and Keoghs and other qualified plans inside the living trust?

Screen-Shot-2013-01-30-at-8.55.45-AM8-300x2576Answer:  No.  Qualified plans must be owned by the individual in order to continue to qualify for favored income tax treatment.  However, the death beneficiary should normally be the spouse as the primary death beneficiary with the children being the contingent death beneficiaries.  In some cases, it may be appropriate for the trust to be the contingent death beneficiary.   Your trust should contain special provisions if the trust is to be the beneficiary of a qualified plan. If done properly the children who will inherit your IRA can benefit from making withdrawals over their expected lifetime. Just as you benefited from allowing these funds to build tax deferred, your children can continue the practice after your death. This should result in many more dollars being paid to the children over their lifetime.

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Should life insurance policies which I own on my children, grandchildren or others be placed inside my living trust?

Screen-Shot-2013-01-30-at-8.55.45-AM8-300x2576Answer:  It depends.  If you are the owner of an insurance policy on someone else without a contingent owner, the ownership of the policy should be transferred to your living trust or you should name a contingent owner in order to avoid probate if you die.

 

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Should my life insurance policies and annuities on my life be placed inside the living trust?

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Answer:  No, generally not.  If you are the owner of your life insurance policy or annuity, then it is not necessary to transfer ownership to your trust.  However, your living trust should normally be the beneficiary of your life insurance and annuity policies.  By naming your living trust as the beneficiary of your life insurance and annuity policies, you are able to consolidate all of your wishes into one comprehensive distribution plan.

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DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Is there any problem with transferring assets held in joint tenancy into the living trust?

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Answer:  No.  Transfers of joint tenancy property into the living trust are quite common.

FB

DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Do I place rental properties in my living trust, and, if so, how is the rent treated?

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Answer:  Yes.  It is important that you transfer your assets into the living trust including your rental properties.  The rental income is recorded on your tax return just as you have done before.  Depreciation expenses on your rental real estate will also be handled in the same manner as you did prior to creating your living trust.

FB

DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 

Do I put recreational vehicles and boats into the living trust?

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Answer:  Yes.  It is essential that any titled items be transferred into your living trust in order to avoid probate.

FB

DISCLAIMER – Every case is different because every case is different. This blog does not give legal advice. This blog does not create an attorney client relationship. You are not permitted to rely on anything in this blog for any reason. This blog is an entirely personal endeavor. Every person’s situation is different and requires an attorney to review the situation personally with you.
No attorney-client relationship is created by this site.

The use of the Internet, this blog or email for communication with this firm or any individual member of this firm does not establish an attorney-client relationship. Before we represent any client, the client and the attorney will sign a written retainer agreement.
If you do not have a written, signed retainer agreement with us, we are not representing you and will not be taking any action on your behalf.

 



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