How to Transfer Property Into a Living Trust

Know your assets and their locations.

You may wonder what you may do with a living trust and, quite frankly, why to bother. A living trust is revocable during the settlor's lifetime. You, the person who created the trust, are the "settlor." Upon the death of the settlor, assets are not subject to probate but are distributed by the trust. Any assets not owned by the trust on the date of your death are not part of the trust estate and will have to be probated. By transferring assets into a living trust, you--the settlor--control your assets during your lifetime, you dictate how and to whom your assets are distributed upon your death and you avoid probate. Exercise caution so all of your assets are properly assigned to the trust.

Things You'll Need

• Vehicle titles
• Deeds
• Lease agreements
• Stock certificates
• Bonds
• Insurance policies
• Account and financial statements

Instructions

1. 

   Real estate includes homes and vacant lots.

   Execute a deed transferring real estate ownership to the trust. You may use a quit claim deed or warranty deed. A quit claim deed is where the grantor "quits" any interest that he or she may have had in the real estate. A warranty deed is where the grantor guarantees or warrants that he has clear title to the real estate and is transferring a good title. File the deed. Assign any insurance on the property to the trust. A real estate attorney will prepare any required deed at a relatively nominal fee.

2. 

   Do not forget accounts at banks, credit unions and other financial institutions.

   Open bank accounts in the name of the trust. Assign open bank accounts to the trust. Banks have forms, or an estate-planning attorney can draft the appropriate form to assign any existing bank accounts to the trust. Either way, take a copy of the trust agreement to the bank, credit union or other financial institution. Because the living trust is revocable, the settlor's Social Security number will continue as the taxpayer identification number on bank accounts even after the accounts are properly assigned to the trust.

3. 

   Do not forget the brokerage account.

   Transfer stocks or bonds that are registered in the settlor's name to the trust. Publicly traded stocks and bonds will need to be guaranteed. The stock brokerage firm should be able to assist with the guarantee. If you do not have a stockbroker, have an estate planner or an estate planning attorney handle the transfer. Stocks and bonds in brokerage accounts are not individually transferred to the trust. Rather, the brokerage account is transferred to the trust. The transfer of stocks, bonds and brokerage accounts from the settlor to the trust is done by simply filling out an assignment form available from the stock brokerage firm. The settlor's Social Security number will remain as the taxpayer identification number on the individual stocks and bonds, as well as any brokerage accounts that have been properly assigned to the trust.

4. 

   Vehicles include cars, trucks, campers, trailers, boats and recreational vehicles.

   Transfer or assign vehicle titles to the trust by executing an assignment form. Vehicle assignment forms are available at local branches of the secretary of state's office. Simply fill out the form and pay the transfer fee. For all automobiles, boats, motorcycles and registered vehicles transferred to the trust, also assign any insurance policies to the trust. Your insurance agent should be able to provide you with a form to assign the insurance to the trust.

5. 

   How should life insurance policies be handled?

   Transfer ownership of any life insurance policies by executing an assignment. Change the beneficiary of any life insurance policy insuring the settlor's life to the trust by completing a change of beneficiary form. Both forms will be available from your life insurance carrier. Life insurance policies pass outside of probate and, if avoiding probate is the only reason to place this asset into a living trust, it is not necessary. There are, however, legitimate reasons for placing life insurance in a living trust that have nothing to do with avoiding probate. Consult with an estate-planning attorney to discuss life insurance and the benefits and disadvantages of placing this asset into the trust.

Tips & Warnings

• The purpose of this article is to provide information only. Information may be of a legal nature. However, nothing in this article should be construed as legal advise. There are many factors to consider in estate planning. If in need of financial, tax, legal or estate planning advise, contact the appropriate professionals.