Why make a will? Why make a Trust?

Can a will and a trust do the same thing? Is it a toss up? What is the difference?

The State of Texas legislature long ago in the early 1880’s copied the English law of wills updating those laws a number of times since (and still keeps making changes around the edges. That means the law is “tweaked” a little from time to time to improve it or correct some perceived problem in the way the law is applied by the court system).

People own assets because they exchange money for title to the asset. “Title” here mean
possession and control of tangible personal property and real property by means of proof of
exchange of money for possession and control. An owner wants to control the transfer of title at
death because the asset represents the money (or value) spent to buy it or, if you will, the tangible evidence of the exchange (such as third party financial institutions’ accounts or automobile certificates of title)

The law says a will-maker (or trust-maker) is entitled to transfer property at death to anyone
chosen (subject to some non-citizen exceptions). It defines the basic elements or requirements to make the transfers title clear and certain. The formal requirements for a will and the method that must be followed for the will to have effect have very little room for deviance…that is,
compliance standards are rigid. But that is a subject for another day. For now, we will assume a
will is compliant.

The legal elements that a trust consists of are simple. It must: be in writing, appoint a trustee,
name one or more beneficiaries, receive and hold title to assets transferred to the trustee; contain instructions to the trustee about how and when to distribute benefits to the beneficiary. We will assume that the trust in this example is effective to transfer title to assets to the beneficiaries named in the will at the owner’s death with clarity and certainty.

Trusts offer convenience and trouble free existence in that the terms of the trust are worked out in advance of need rather than having to investigate the nature and extent of the ownership of assets just after the death of the Trustmaker. Trusts are intended to administer assets for the benefit and during the lifetime of the Trust-creator (the “Trustor”) in advance of the pressure of locating assets and dealing with creditors immediately.

The trust is revocable and is not a taxpayer, so it doesn’t get a tax ID number.

Ready to Plan Your Estate? Let Jon T. Oden, Attorney at Law Help

Don’t leave your family’s future to chance. Contact Jon T. Oden, Attorney at Law today for a consultation and take control of your estate planning.