Creating a trust for nieces and nephews

On Behalf of | May 28, 2021 | Firm News

Some people in Indiana have close relationships with their nieces and nephews and want to make sure that they receive some of their assets when they pass away. While it is possible to leave assets them through a last will and testament, creating a trust and naming them as beneficiaries might allow them to avoid the probate process and receive the assets directly much faster.

Transferring assets outside of probate

Trust accounts are not subject to the probate court, allowing the assets held by the trusts to be distributed according to their terms. People can create revocable trusts while they are alive and transfer ownership of their assets to the trusts. Since they are revocable, the grantors are still allowed to make changes to them while they are alive. However, once they pass away, the trust accounts transform into irrevocable trusts, meaning they cannot be changed. Establishing a revocable trust and naming your nieces and nephews as the beneficiaries allows you to make sure that they will receive the percentages of your assets that you want them to get.

Other ways to transfer assets

Indiana is among the states that allow people to transfer real property through transfer on death deeds. This involves changing the deed to include a transfer on death provision. This allows the real property to automatically pass to the heirs without going through probate court. You can also add payable on death provisions to your bank and savings accounts so that your nieces and nephews will receive the proceeds once you die.

Creating a trust and using payable-on-death and transfer-on-death provisions can allow people to leave money to their loved ones outside of the probate process. Avoiding probate can help to prevent a long and expensive court process after you pass away.