If you are familiar with living trusts, you know that, for a trust to function correctly, you must “fund” your trust, which means you must transfer ownership of assets from your name to the name of your trust. For your home or other real estate, you execute a deed. For your car, truck or boat, you transfer title to your trust. But what about your other assets that have high monetary or sentimental value but do not have deeds or title documents? To optimize the effectiveness and efficiency of your estate plan, you may want to ensure these assets are funded into, and addressed by, your living trust, too.
People may own a wide array of assets that do not have ownership title documents but still hold significant value. Take, for example, one recent auction, where some memorabilia associated with basketball star Michael Jordan sold for more than $50,000. In another auction, a collection of 228 early American half-pennies fetched more than $18 million.
While your collectibles may not be worth $18 million, it is possible that the value of your collection of valuables alone could be high enough to make your estate ineligible for a small estate procedure, and require the completion of a more protracted probate process. An ancestor’s antique fine jewelry or a collection of stamps, coins or art with several rare, prized pieces could easily have value in excess of $50,000.
Alternately, even if your collection has a relatively small appraised value, it may still hold a high sentimental value for you and a loved one. Perhaps you own an antique toy that, through years of use, is not valuable as a collectible, but holds a dear place in your heart and that of a child or grandchild. In this case, you may place an elevated importance on distributing that asset in a specific way.
Whether your collection or special asset has great financial worth or possesses high sentimental value, your living trust can help you make sure that this special asset goes to a specific beneficiary. Your estate planning attorney can help you create the documents you need to realize these objectives. For some items, you may complete a “schedule of assets” that lists various pieces, or you may construct an “assignment” document that relates to an individual asset. In either case, the documents you create will ensure that your special assets are funded into your trust.
Additionally, you’ll need to create specific instructions in the distribution paragraphs of your trust if you want you a special asset to go to a particular beneficiary. Better yet, your trust can refer to a separate list of beneficiaries for specific pieces of personal property. This list can be hand-written by you, and changed without the formalities of witnessing and attorney drafting. Without one of these options, your collection or sentimental asset will be pooled with the rest of your assets and distributed according to your general distribution directions.
To get started on your complete estate plan, including planning for passing on your beloved antiques, collectibles or special possessions, call Madison estate planning attorney Daniel J. Krause or Nelson W. Donovan of Krause Donovan Estate Law Partners, LLC. They can guide you through the process of estate planning, and help you construct a plan to accomplish your objectives. Contact one of our attorneys today.
Reach us through our website or call our office at (608) 268-5751 to schedule your confidential, no obligation initial consultation.
Timeshares and Living Trusts: Funding Issues, Wisconsin Probate & Estate Planning Blog, Dec. 16, 2013
No More Outright Distributions; Give Your Heirs Protected Assets, Wisconsin Probate & Estate Planning Blog, Nov. 14, 2013
Personalization is Key to Ensuring Wisconsin Estate Plan Functions Properly, Wisconsin Probate & Estate Planning Blog, March 4, 2013