Trust Asset

By Robert B. Bellitto, Jr., Esq.

Signing a trust agreement without physically transferring assets into the trust is like putting on your socks but forgetting your shoes. Assets are NOT automatically transferred into your trust just because you signed it. Here are some helpful tips on how to transfer the most common types of assets into your trust.

1. Change the title of your checking and savings accounts and certificates of deposit which are to be held in the Trust to:

Example:  John Smith, as Trustee, or his successors in trust, of the John Smith Revocable Living Trust dated January 1, 2025, as now or hereafter amended

2. Re-register all stocks, bonds and brokerage accounts to be held in the Trust in your name as Trustee.

Example: The undersigned hereby assigns all right, title and interest in and to the following securities to John Smith, as Trustee, or his successors in trust, of the John Smith Revocable Living Trust dated January 1, 2025, as now or hereafter amended

3. Assign all Partnership interests and LLC interests to your name as Trustee.

Example: The undersigned hereby assigns all right, title and interest in and to the following Partnership Interests/LLC Interests to John Smith, as Trustee, or his successors in trust, of the John Smith Revocable Living Trust dated January 1, 2025, as now or hereafter amended

Any required acceptance of the General Partner and/or other partners (for Partnership interests) or the Manager and/or other members (for LLC interests) should also be obtained, and any other transfer requirements or restrictions imposed by the entity’s Partnership Agreement or Operating Agreement also need to be complied with.

4. Convey real estate which is to be held in the Trust to yourself as Trustee.

Example:  John Smith, as Trustee, or his successors in trust, of the John Smith Revocable Living Trust dated January 1, 2025, as now or hereafter amended

The deed should be in proper form to meet the requirements of the state in which the property is located. You should contact your title insurance company and homeowner’s insurance company to determine if any addendum or rider is needed to continue the insurance once the property is transferred to your Trust. If you have a mortgage on your property, you should contact your mortgage lender to determine if a transfer to a trust is allowable. Most banks have no issue with a conveyance to a revocable living trust, but a transfer to an irrevocable trust may not be allowable.

5. Change the beneficiary of insurance policies payable to the Trust to yourself as Trustee.

Example: John Smith, as Trustee, or his successors in trust, of the John Smith Revocable Living Trust dated January 1, 2025, as now or hereafter amended

6. Change the beneficiary designation of retirement benefits:

Example:  John Smith intends to name Mary Smith and Paul Smith as the beneficiaries of his IRA and provide that if Mary or Paul do not survive John, then his or her share will pass per stirpes to his or her then living descendants.

Different financial institutions have different forms required to transfer accounts to a Trust. You will need to contact each financial institution to determine what is required.

You do NOT need to transfer all of your assets into your Trust. It is up to you which assets to transfer and which to leave alone. In addition to speaking with your attorney, you should also speak with your accountant and/or financial advisor to understand what tax and/or financial consequences there are for transferring particular assets into your Trust.