There are many tools you can use for estate planning in Indiana, two of which are pour-over wills and living trusts. Both can help you transfer your assets to your loved ones after you pass away, but they work differently and have different advantages and disadvantages. Here’s what you should know.
Understanding a pour-over will in Indiana
A pour-over will is a type of will that transfers unallocated or leftover assets in your estate to a trust after your death. People with large or complex estates prefer to use them in conjunction with living trusts because it allows them to retain control over their assets and make changes while they are still alive.
Some key points to know about pour-over wills in Indiana include the following.
- They must go through the probate process.
- You have the right to modify or revoke your pour-over will at any time as long as you are mentally competent.
- They only apply to assets in your name.
- They are subject to estate taxes.
A living trust in Indiana
A living trust, also known as an inter vivos trust, is a legal document that holds your assets during your lifetime and specifies who will receive them after your death. As mentioned, you will still have control over your assets while you’re alive, but upon your pass, your trustee assumes complete control and distributes the assets according to your instructions.
Establishing a trust of this nature can help you avoid or minimize the probate process. So, instead of the court subjecting your unallocated assets to Indiana’s intestacy laws, your trustee will simply transfer them to your chosen beneficiaries as per your stipulated guidance.
A pour-over will is an effective and valuable tool that guarantees the preservation of your hard-earned assets, ensuring they don’t go to waste. Moreover, it helps to save time and minimizes legal headaches for your loved ones. An important tip to remember when establishing a pour-over will is that regular reviewing and continuous updates are just as critical as the initial creation. This ongoing maintenance ensures it remains valid and aligns with any changes in law or your circumstances.