Revocable Living Trusts
A revocable living trust allows its creator, the trustor, to serve as the trustee when they are still alive. Since these trusts are “revocable,” their terms, holdings, and beneficiaries can be changed at any time up until the trustor’s death. However, a revocable living trust only offers a single layer of protection for privacy-conscious estate planners since the trustee’s information will still be listed in public records. Appointing a fiduciary, such as an estate planning attorney, as trustee could provide an additional layer of insulation from scrutiny.
Blind Trusts
Blind trusts restrict the trustor’s role in trust management and administration. While the trustor can transfer assets into the trust’s control, a designated third-party trustee must manage them. Blind trusts are typically comprised of financial accounts and investments; they are frequently used both to avoid conflicts of interest and to maintain the trustor’s absolute privacy.
Golden State residents can also protect their real properties from prying eyes by establishing an anonymous limited liability company or LLC. If an LLC owns a real property, the grant deed provides a title to the LLC rather than to its individual owners or members.
What to Ask an Attorney About Anonymous Trusts
Establishing a revocable living trust, blind trust, or an anonymous LLC can present unexpected challenges. Since trusts may be subject to state and federal reporting requirements, trustors who inadvertently violate the law could face harsh penalties, including civil fines and criminal prosecution.
If you are considering a trust to protect your privacy, contact an experienced California estate planning attorney. During your initial consultation, you will have the opportunity to ask important questions about your trust, its privacy-protection benefits, and after-death administration.
Here are five questions you should ask your attorney before making a commitment:
- Will you help me administer the trust when I’m still alive?
- How many years have you practiced estate planning?
- Do revocable living trusts offer any tax benefits?
- Do trusts offer inheritance benefits beyond an ordinary last will and testament?
- Could a trust or anonymous LLC reduce my estate’s liability in the event of an estate contest or creditor dispute?
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