Requirements in Illinois for Revocable Living Trusts

By John Cromwell

A revocable living trust transfers property from a living grantor, or creator, to a trustee through a written agreement. The trustee manages the property and distributes it to individuals, known as beneficiaries, subject to specific terms. A revocable trust allows the grantor to change the terms whenever he wants; an irrevocable trust does not. Illinois does not require that you file any documents with a state agency to create a valid revocable living trust, but you must meet several other requirements.


Generally, the grantor of a revocable living trust is also the trustee. If you decide to act as the trustee of your trust, you should appoint a successor to manage the trust when you die or become incapacitated. The trustee should be someone you trust to follow the trust terms and who also has the necessary financial and legal background to manage the trust. The trustee should be able to remain impartial when distributing assets to the beneficiaries.


Beneficiaries are persons or entities who benefit from the trust. In the early stages of the trust, you as the grantor and possibly your spouse and children are the beneficiaries. Beneficiaries are able to use the property in the trust, such as the family home, and collect income generated by trust assets, such as dividends. Once you pass away, the terms of the trust prevail. Another beneficiary may be appointed, the remaining beneficiaries may continue to use the property under the trust terms, or all the trust property may be distributed to the beneficiaries as defined by the terms of the trust.

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Establish the Terms

The terms of the trust define how the trust property is to be maintained and distributed. The terms must be in writing and signed by the grantor. A living trust can be constructed to address a variety of circumstances, such as the beneficiaries having a lot of creditors or if the beneficiary is a child. When preparing the trust, you should consider how much discretion you want to give the trustee in making distributions, the financial experience of the beneficiaries and how much protection the trust property needs against the beneficiaries’ creditors.

Transfer Title

To finalize a trust in Illinois, you need to transfer the assets to the trustee. The trustee holds the property in his name for the benefit of the trust. If you are the grantor and trustee, the transferring documents should include a phrase similar to: "from John Smith to John Smith as trustee of the John Smith Revocable Trust." To transfer real estate, record a deed showing the change of ownership in the county where the property is located. You should also send a “letter of direction” to financial institutions informing them which bank accounts or investments now belong to the trust. If you transfer a car into the trust, register that transaction with the secretary of state. Personal property such as furniture or jewelry does not require any formal documentation.

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How to Create a Valid Living Trust in Illinois


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Can You Transfer Debt Into a Living Trust?

A living trust is an agreement in which you transfer your assets into the ownership of the trust. You can retain control of those assets by naming yourself as trustee until your death, at which time a successor trustee takes over and distributes your assets to your beneficiaries. While you cannot transfer debt into a living trust, creditors might be able to reach the assets in the trust during your lifetime and after your death.

How to Prepare an Amendment to a Revocable Trust

You create a living trust to transfer assets to the control of a trustee, who has the legal authority to manage the assets and distribute them to your named beneficiaries according to your instructions. A revocable trust is one that you may legally amend at any time with the use of a simple amendment.

How to Transfer Title to Revocable Trust

A revocable trust is useful largely because it avoids probate proceedings after the death of a settlor. Assets titled in the name of the settlor usually go through probate, however. To avoid this outcome, revocable trust property is transferred into the name of the trustee. A revocable trust can hold many different types of property – real estate, vehicles, personal property such as office equipment, stocks and bonds, and bank accounts.

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