What is a Revocable Living Trust?

A Revocable Living Trust is a written agreement that creates legal entity that is distinct from you. A Revocable Living Trust is a seperate entity from you similar to a Corporation or LLC. Thus, a Revocable Living Trust may have its' own federal tax identification number similar to a social security number. A Revocable Living Trust is often times called a "Living Trust" because it is a legal document that is alive and relevant while you are alive. In case of an incapacity, your Living Trust provides a successor Trustee to manage your financial affairs.

Moreover, a Living Trust avoids probate court unlike a will. A will simply distributes your property upon your death. Similarly, a Living Trust distributes your assets upon your death, but can impose restrictions unlike a will. For instance, a Living Trust may instruct your successor Trustee to distribute a certain percentage of assets at age 30 to your son or daughter. Thus, a Living Trust may restrict how your beneficiary's inheritance may be spent to protect their interests against youth. Another advantage of a Living Trust is your beneficiaries are protected against divorce and creditor concerns because a spendthrift provision in the Living Trust prevents a creditor (or in-laws) from attaching your hard earned dollars.

In conclusion, a Living Trust creates a smooth transition upon your death and avoids the pain of probate court. Furthermore, a Living Trust protects your beneficiaries from divorce and creditor claims. In conclusion, a Living Trust is a powerful estate planning tool.

Sean Robertson is an estate and asset protection attorney in downtown Chicago at 35 East Wacker Drive, Suite 935, Chicago, Illinois 60601. Sean Robertson may be reached at (312) 498-6080.