Is a Living Trust Good in All States?

By Mary Jane Freeman

Living trusts are a commonly used estate planning tools, because they are flexible and recognized in every state. The person who creates the trust maintains control of her property during her lifetime and upon her death, the property automatically transfers to the beneficiaries named in her trust.

Living trusts are a commonly used estate planning tools, because they are flexible and recognized in every state. The person who creates the trust maintains control of her property during her lifetime and upon her death, the property automatically transfers to the beneficiaries named in her trust.

Living Trusts Valid in All States

A living trust, also known as an inter vivos trust, is created during a person's lifetime. The person who creates the trust, the settlor or trustor, places property in the name of the trust for the benefit of others, known as beneficiaries, who will receive the property upon the settlor's death. The settlor also designates a trustee to manage the trust, although settlors often serve in this capacity while they are alive. While living, the settlor can make changes to the trust, including moving property in and out of it or changing beneficiaries. Once a valid living trust is created, it is valid in every state, not just the state in which it was created. This means that a settlor can move to a different state after creating her living trust, and the new state will honor it.

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What Is a Non Testamentary Trust?

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Tennessee Law on a Living Trust

A living trust can be used to safeguard your property during your lifetime and help avoid probate at death. In Tennessee, it is common for the creator of a living trust to oversee the distribution of the trust's funds and receive trust income during his lifetime. Knowing the requirements for creating a living trust and the circumstances in which it may be modified will ensure that your trust operates according to your wishes in Tennessee.

Is a Living Trust Liable or Subject to Probate?

A living trust holds assets that are managed by a trustee for intended beneficiaries. Also called a revocable trust, it differs from other trusts in that the trust creator, or grantor, can also serve as the trustee and can make changes to, or even revoke, the trust in its entirety during his lifetime. Living trusts are attractive because the grantor retains ultimate control over his assets while he is alive, but they are most commonly used to avoid probate.

Can an Heir Sell Property When the Title Is in a Revocable Living Trust?

Revocable living trust property generally cannot be sold outright by a beneficiary; the property must be first transferred to the beneficiary and placed in his name. However, if under the terms of the trust, the beneficiary has the right to claim trust assets for personal use, this is a simple issue of transfer. The key issue is the trust's restrictions on distributions. The trust creator's intent, whether there are multiple beneficiaries or the existence of a spendthrift clause can limit a beneficiary's ability to sell trust assets. Trust law varies by state so consider consulting an attorney if you wish to sell trust property.

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