A trust allows you to place your assets under the control of a trustee you select, for eventual distribution to the trust beneficiaries. A trust is useless, however, until you transfer assets to it in accordance with appropriate legal procedures. If your trust is irrevocable, its assets are no longer yours -- they belong to the beneficiaries under the terms of the trust deed, even though legal title is vested in the trustee.
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Amend the property schedule, in duplicate, whenever you add more assets to the trust. Sign and date the amended property schedule in the presence of a notary public, and deliver one copy to the trustee.
Create a notice of assignment, in duplicate, in which you state that you are transferring all right, title and interest in the items listed in the property schedule to the trustee under the terms of the trust deed. Sign the notices in the presence of a notary public, and list the place and date that the notices were signed. Deliver one copy to the trustee and keep one copy for yourself. The notice of assignment is particularly important with respect to items of property that cannot be titled, such as household furnishings, because it is the only evidence that these items belong to the trust.
Open a trust savings account in the name of your trustee and deposit any cash you are donating to the trust into this account. Although different banks may impose different restrictions on how you may name a savings account, the account must be in the trustee's name and should indicate that he holds account funds on behalf of the trust -- for example, "John Doe, Trustee for the Brent Hopkins Trust Fund."
Sign corporate share certificates over to the trustee, in the name of the trust, by filling out the transfer section on the back of the share certificates. Create a notice of assignment that refers exclusively to the share certificates, and deliver the share certificates and the share transfer notice of assignment to the trustee. Depending on the terms of company bylaws, the trustee may be able to have new share certificates issued in his name.
Draw up a quitclaim deed to grant any real estate you wish to place in the trust to the trustee, after paying off any encumbrances such as a mortgage or a property tax bill. Sign the deed, record the transfer at the county land recorder's office, and deliver the deed to the trustee. Although you may draft your own deed, many county land recorders offer standardized, "fill in the blank" forms.
Transfer title to any vehicles you are donating to the trust by filling out and signing the transfer section on the back of the title document, after paying off any liens on the vehicle. Some states require the trustee to sign this section as well. Record the transfer at the local Division of Motor Vehicles, or its equivalent in your state, and have the DMV issue a new title in the name of the trustee.
Tips & Warnings
- To the extent permitted by state law, indicate the trustee's status as a representative of the trust on any title documents.
- If you wish to transfer title to real estate or automobiles to the trust without extinguishing liens on the property, the lien holder must consent to the transfer of title.
- You cannot transfer title to the trust itself -- you must transfer it to the trustee.
References & Resources
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