Are you familiar with or are interested in setting up a revocable trust in Kentucky but need help knowing where to begin? 

A revocable trust is a legal entity individuals create to manage and distribute assets during their lifetime and after death. As the name suggests, you can modify or revoke this trust anytime while you’re alive. In Kentucky, anyone over 18 can establish a revocable trust. Again, people decide what property to include and name a successor trustee to manage the trust after their death. Revocable trusts are valuable tools in estate planning. They offer control during your lifetime and are efficient asset transfer upon death.

At Elder Law Guidance, we have plenty of experience helping people who want to plan for their future. We focus on helping families protect all they have worked for throughout their lives. We invite you to visit our Practice Areas page to know how we can help you. 

We’re ready to help you set up revocable trusts in Kentucky. So, contact us today to schedule a consultation. 

What’s a Revocable Trust?

According to the Consumer Financial Protection Bureau (CFPB), “a revocable trust is an arrangement set up through a legal document. The document gives someone the power to make decisions about another person’s money or property that’s held in the trust. People use trusts to keep control of their money and property and to designate who receives money and property once they die.” 

Moreover, the person who creates the trust is called the grantor or settlor. The grantor maintains control over the assets placed in the trust and can act as the trustee, managing the trust’s property.

Key features of a revocable trust include:

• Flexibility: You can add or remove assets, change beneficiaries, or dissolve the trust entirely.
• Privacy: Unlike wills, revocable trusts usually are not public records, as noted by the following article published by USBank.com.
• Probate Avoidance: Assets in the trust bypass the probate process.

Benefits of Revocable Trusts

Revocable trusts offer numerous advantages for estate planning in Kentucky. One of the primary benefits is the control and flexibility they provide. Trust creators can modify or revoke the trust anytime, allowing for adjustments as life circumstances change. For more information about this, refer to the Kentucky Revised Statutes § 386B.6-020, Revocation or amendment of revocable trust. 

Another critical advantage is simplifying probate. By transferring assets into a revocable trust, attorneys help clients bypass the time-consuming and potentially expensive probate process. This not only saves money but also maintains privacy for the estate.

Asset protection is another crucial aspect of revocable trusts. They ensure that if the trust creator becomes incapacitated, a designated successor trustee can step in to manage the assets without court intervention. However, it’s important to note that revocable trusts serve to manage assets rather than protect them from creditors. Nevertheless, this seamless transition can help protect seniors’ financial health and provide peace of mind for families. 

Finally, a revocable trust can benefit those with real estate in multiple states. It eliminates the need for ancillary probate proceedings in each state where the property is owned, simplifying the asset transfer process.

Setting Up a Revocable Trust in Kentucky

Creating a revocable trust in Kentucky involves careful planning and specific legal steps.

To set up a revocable trust in Kentucky, individuals first need to identify the assets to include. This may encompass real estate, bank accounts, and investments. Next, we draft the trust document detailing how the assets will be managed and distributed. The trust document should name a trustee and beneficiaries. 

It’s crucial it complies with Kentucky Revised Statutes governing trusts. Once drafted, the grantor signs the document in the presence of a notary public.

After signing, individuals transfer the chosen assets into the trust. This process, known as “funding the trust,” may involve changing titles on property deeds or updating beneficiary designations on financial accounts.

Choosing the Right Trustee

Selecting a trustee is a crucial decision in creating a revocable trust. As mentioned above, the trustee manages the trust assets and carries out the grantor’s wishes. When choosing a trustee, people should consider financial understanding, trustworthiness, and availability.

A trustee’s responsibilities include managing investments, paying bills, and distributing assets to beneficiaries. They are required to keep accurate records and act according to the beneficiaries’ interests.

At Elder Law Guidance, we often recommend naming a successor trustee as well. This person steps in if the primary trustee becomes unable to serve. Some grantors opt for co-trustees, spreading the responsibility among multiple individuals or entities.

Common Misconceptions About Revocable Trusts

Revocable trusts and wills are not the same. While both serve important roles in estate planning, they function differently. A will takes effect after death, while a revocable trust can manage assets during one’s lifetime and after death.

Contrary to popular belief, revocable trusts can be changed; remember Kentucky Revised Statutes § 386B.6-020, Revocation or amendment of revocable trust. As noted above, the flexibility to amend or revoke these trusts is one of their key advantages. This allows for adjustments as life circumstances change.

Some mistakenly think revocable trusts completely avoid probate. While they can simplify the process, certain assets may still need to go through probate if not properly titled to the trust.

A common misconception is that revocable trusts provide asset protection. In reality, they offer little protection against creditors or legal claims during the grantor’s lifetime.

Many assume creating a revocable trust is a complex, time-consuming process. Setting up a trust in Kentucky can be relatively straightforward with proper guidance.

How Elder Law Guidance Can Help

We at Elder Law Guidance can guide you through the complex process of creating and managing revocable trusts in Kentucky. Our skilled lawyers are ready to help individuals establish trusts that protect their families’ futures. They can also explain how these trusts work with other important documents like powers of attorney and living wills.

Our attorneys stay up-to-date with Kentucky’s trust laws. They can help you navigate these regulations to ensure your trust is legally sound and effective. We aim to provide clear, professional advice tailored to your unique circumstances.

Medicaid and Medicare planning are also crucial aspects of elder law. We can advise on how revocable trusts may impact Medicaid eligibility and help structure assets to meet your long-term care needs. We offer tailored trust solutions for those with special needs family members to ensure their continued care and support.

Our goal is to provide clear, professional advice tailored to your unique circumstances. So, contact us today to schedule a free initial consultation to discuss your situation. We’re here to help you protect your assets and secure your family’s future.