Does Having A Revocable Trust Eliminate The Need For A Will?
One of the key reasons people create a revocable living trust is to avoid the need for probate after their death. Assets held by a trust are not considered part of the settlor’s individual probate estate. This means that upon the settlor’s death, the trust continues to hold the trust’s assets, subject to any instructions left by the settlor in the trust instrument.
So if you have a trust, do you actually need a will? The short answer is “yes.” There are a few reasons, but the main one is that no matter how carefully you planned and funded your trust, there is always a chance that there will still be some “unforeseen” probate assets that will need to be dealt with. Having a will is therefore still a necessity.
The “Pour-Over Will”
Generally speaking, when someone has a revocable trust as their principal estate planning vehicle, they will execute what is known as a “pour-over” will. As the name suggests, the purpose of such a document is to transfer or “pour over” any probate assets into the deceased individual’s trust. In simple terms, the will names the trust as the sole beneficiary of any probate estate.
Keep in mind there are some situations where it is not possible to transfer assets to a trust prior to death. A common example is a legal claim that arises after the settlor’s death. Say a person is killed in a car accident caused by another driver’s negligence. The deceased person’s estate has the right to file a wrongful death lawsuit. This claim cannot be brought by a trust. However, a pour-over will would ensure that any monetary damages recovered by the probate estate would then be transferred into the trust.
It Is Not Just About Assets
A pour-over will is also important especially if you have minor children. In a will, you can nominate a guardian to raise your children if the other parent is also not around. This cannot be done with a trust.
A will also allows you to name a personal representative to oversee any probate estate. Even absent a will, if any probate assets are discovered after your death, the court will have to name a personal representative, which may be someone different than (or adverse to) your trustee. By having a pour-over will, you can ensure that any personal representative who may be named will not undermine the trustee.
No Will Can Lead to Litigation
Indeed, when there is no pour-over will, that can lead to disputes among family members and other potential beneficiaries over what the deceased individual’s “true intent” was, or even whether the trust itself may be invalid. If you are involved in such a dispute and need legal advice from an experienced Pompano Beach estate and trust litigation attorney, contact the offices or Mark R. Manceri, P.A., today to schedule an initial consultation.