Byline Revocable Living Trust Made Easy

Byline revocable living trust

okay so in this video we're going to talk about ten provisions every revocable living trust should have so I'm Paul Rabalais I'm an estate planning attorney every morning at 10 a.m. Central time check in to this YouTube channel where I'm going to give you another educational video that will help you protect what you have for yourself and your family all right I want to give you a little bit of introduction to this topic and then jump in to the ten necessary provisions okay when people get their legal affairs in order they do several different things yes they they provide for where their stuff will go when they die how they want to leave it to their spouse if they're married to their children if they have children or grandchildren to others and that all is very necessary and very appropriate appropriate in addition to designating you know how things are to be distributed when when you pass away many people also want to simplify or streamline that process of getting their estate settled so many people instead of using a will or last will and testament to provide for where their things go when they die and when when you use a will and you pass away with assets in your name your assets are frozen and the executor or other family members will hire lawyers like myself to guide the family through a court supervised process to have things transferred from your name to your heirs many people perceive that as being very difficult expensive and time-consuming they probably perceive it because it can be all of those things so in order to eliminate all of that lawyer and court involvement in the estate settlement many people set up their what we call their revocable living trust and during their lifetime they transfer the title of assets that they own to their trust things that are in a trust when you die they don't get frozen they don't go through the court process you'll name probably a family member to be the trustee of your trust after you pass away and then they can immediately disperse things out of the trust to your heirs or beneficiaries without any court or attorney involvement so that's the idea there there's lots of videos that I've made on kind of the ins and outs of using a revocable living trust but when one uses a revocable living trust or if you use a revocable living trust to in essence replace your will and allow for the settlement of your estate without going through the courts then there are ten provisions that should be considered or should be in your revocable living trust so let's go through those and before I go through those just a quick reminder make sure you hit the subscribe button along with the notification bill that way you won't miss anything and if you felt like this provides you with some value give it a thumbs up and if you want to contribute with some comments below feel free to do that as well all right let's let's roll here ten provisions that every revocable living trust should have number one is and another little issue here I work as a lawyer in Louisiana and I've helped many many thousands of clients over the last you know 28 years get them keep their legal affairs in order and so some of these things I'm going to go over are state specific and so you may need to check with someone if you're not in Louisiana most of what I'm gonna go over is general but there's a couple of provisions that that could be state specific the first one in particular so you want to make sure that in your revocable living trust you state that your trust is revocable so here in Louisiana that's why I've brought up the Louisiana thing our trust code says that a set lor a set lor is you or the person who sets up the trust and transfers their assets to the trust our Louisiana trust code says a set lor may revoke a trust only if he has reserved the right to revoke the trust so when your trust you have to say this is a revocable trust or something to that effect number two is you'll want to designate the trustee of your trust in the traditional or customary revocable living trust you will name yourself as the trustee perhaps if you're married you'll name your you and your spouse as the co trustees and then after one spouse dies perhaps the surviving spouse is the sole trustee so you'll need to designate those those trustees but not name yourself as the trustee you want to make sure you name a successor trustee because the trust is going to last for some period of time after you pass away because when you pass away there's that process of transferring the assets out of your trust to your trust beneficiaries may call it your heirs and it's going to take that successor trustee that you name and your trust instrument to do that job of dispersing the trust assets to the trust beneficiaries and accordance with the trust instrument so number two trustee designation number three designate who the income beneficiaries of your trust are again in the customary revocable living trust you will be what's called the income beneficiary for life which means if your trust assets produce some income whether that's interest income dividend income or rental income if you are the income beneficiary of your revocable living trust which he probably should be then all that income goes to you and kind of oh by the way on a revocable living trust the trust doesn't need its own tax ID number the trust doesn't have to file a tax return you'll still report that income on your personal return so the trust is really ignored for tax purposes you still report all of the income on your personal return so you'll want to designate who the income beneficiaries of your trust are and you'll likely appoint yourself as the income beneficiary and then maybe you'll have successor income beneficiaries particularly if you want to designate or be specific about who gets the trust income after you pass away number four is who are the principal beneficiaries so trusts have two kinds of beneficiaries I mentioned a moment ago you should designate yourself as the income beneficiary for life and then you'll designate your principal beneficiaries who's going to get the trust assets when you die and maybe you just say my children are equal principle beneficiaries maybe you say as to $25,000 of trust mints principle that will go to my church and the remainder of the trust trust principle will go to my children or maybe you'll say I want 20% of the tree principal when I die to be divided equally among my grandchildren and the other 80% to go to my children equally so there's really no limit on what you can do there but you need to designate your principal beneficiaries that's really important okay and then number five is the trust term I would say in the typical revocable living trust the trust gets wound up after you and I and that successor trustee that we talked about may be the successor trustee is one or more of your children either as an individual trustee or as individual code trustees that successor trustee right after you pass away we'll be in a position to immediately start dispersing assets out of your trust to the principal beneficiaries occasionally and it's it's not uncommon for your revocable living trust to live on after you die perhaps you have young children that and you know if they're 12 when you pass away then that trust should stay in existence so that they don't get the the inheritance and it goes on until maybe they're 25 or some later date and you authorize you know that child share to be used for their health education maintenance and support perhaps so oftentimes trusts terminate when the set lor dies but sometimes they go on for many years after that number six provision that should be in every revocable living trust is a spendthrift clause and this is really applicable in the revocable living trust scenario from the time that you die until assets are dispersed to your beneficiaries and particularly if there's going to be some time period that will take place from when you die to when the assets are dispersed to the appropriate principal beneficiaries but what a spendthrift clause does is it says that in a revocable living trust it says after you die then a beneficiary can't sell or alienate or mortgage his or her interest in the trust a creditor of the beneficiary can't seize the beneficiary's interest and the trust so you know just about every trust has those spendthrift clauses those are a good thing all right number seven is a provision dispensing the security requirement for the trustee here could be another state specific item here in Louisiana if you name an individual trustee to handle things when you pass away an individual as opposed to a corporate trustee then that individual has to post a bond or furnish security which is a real nuisance unless in your trust instrument you waive that bond requirement or you dispense with the requirement that an individual trustee furnish security so you're going to make sure you do that the next one is really an optional provision you know by saying if this these are ten provisions every revocable living trust should have that's kind of a stretch for this number eight which is the no contest clause so some people who kind of first see there may be issues when they died because maybe their children don't get along or maybe their children just aren't real responsible relationships aren't great maybe children have spouses who make things difficult we get asked you know can we put a provision in our trust where if anybody contests anything they don't get anything so another state specific area but you know a lot a lot of people who set up trusts they they like that because they they don't want to encourage you know family conflict they want to discourage it and perhaps when a beneficiary who is thinking about trying to initiate legal proceedings to invalidate a trust or invalidate a provision of the trust if they see that no contest clause in the trust they may think twice about you know raising a concern that they otherwise might raise all right number nine is again a Louisiana thing but we want to make sure that the trust is what's called an authentic act so at the end of the trust there's all the language and all the signature pages so that you sign before a notary public in the presence of two witnesses so that your trust meets the formality requirements of an authentic act so that means that really you know needs to be in every trust and then my tenth and final provision that should be in every revocable living trust kind of with an asterisk is there should also be what's called an extract of the trust so this is if your trust owns real estate and many revocable living trusts own real estate because many people who set up revocable living trusts to make the estate settlement easy many of those people own a home so they put their home in their trust and if a trust owns real estate another Louisiana kind of specific thing then and then what's called an extract extract or sometimes we call it a summary of the trust you know the trust may be several pages long but this extract may be one or two pages and that extract gets recorded in each parish where your trust owns real estate and on that extra extract it states the name of the trust it states a statement that the trust is revocable it states the name of the trustee and and other information that's required in our trust code and in essence what that does is it lets title examiners know who has the authority to act on the Trust's behalf okay so there's your your ten provisions every revocable living trust should have there are other provisions that perhaps you should have but I limited it to ten and everybody's situation is unique so there's other situations where certain other provisions really really are necessary there's a lot out there on trustee duties trustee obligations beneficiary's rights so I don't really didn't get into that I kind of went with the kind of easy top ten list of kind of no-brainer or at least as far as I'm concerned no-brainer provisions that should be in a trust okay just as a reminder I know I reminded you once before make sure you hit the subscribe button in the notification bell so this was a ten and five video it's a ten video because there were ten items or ten provisions that should be never ever revocable living trust what I can't get my mind off of is the is the number five at the time that I'm making this video there's five days until my LSU Tigers play in the national championship game against Clemson on Monday night I'm making this video on Wednesday I'm going to release it on Thursday because I release and published a video every morning 10:00 a.m. Central Time so go Tigers y'all have a great day take care we'll see you tomorrow