B. Transfers by Operation of Law
Some assets are governed by law and how the property is owned, but can vary by state. The most common example is when an asset is owned by more than one person. Some common types of ownership:
- Joint tenants with right of survivorship (JTWROS)
- Joint tenants in common (TIC)
- Intestate succession
C. Transfers Through Trusts
Assets can pass through a contractual arrangement where property is transferred to a trustee who manages and distributes that property for the benefit of the beneficiaries of the trust. If property is transferred to the trust during the owner's lifetime, it is called an inter vivos trust (or living trust.) If property is transferred to the trust through the provisions in a will, it is a testamentary trust.
Trusts may be either revocable or irrevocable. The revocable trust can be terminated and/or changed and offers no special estate tax advantages. An irrevocable trust cannot be revoked by the grantor and can offer special estate tax advantages (See section 77 for more details).
D. Transfers by Contract
Owners of property can make a contract during their lifetime to ensure that assets are transferred to a beneficiary at the time of their death. The most common examples of operation of contract include:
- Retirement plans
- Life insurance policies
The primary benefit of transferring assets by contract is that it is generally much faster than going through probate.
Financial AdvisorRevocable living trusts accomplish estate planning objectives that aren't possible with a will. Here are some of the cases that show when to use a trust.
RetirementEverything you always wanted to know about setting up trusts, in handy glossary form.
Financial AdvisorUnsure of how your assets will be dispersed once you're gone? Here's how setting up a revocable trust while you're here can be a big benefit.
RetirementYou don't have to be rich to make use of a trust fund. Rules can be complex; here's what you'll need to discuss with your lawyer.
Financial AdvisorSeveral improvements and additional provisions have been added to irrevocable trusts in recent years making them considerably more versatile than before.
Managing WealthThis article explains the difference between the two estate transfer methods -- a will and a trust, and the circumstances under which each can be used.
RetirementA revocable trust is a legal arrangement whereby a grantor transfers property to a trustee who holds the property in trust for the grantor’s benefit.
RetirementNo, they're not just for the super-rich. But you need to know the rules.
RetirementA guide to the whys and wherefores of setting up this most versatile of estate-planning instruments in the United Kingdom.
Managing WealthHere are five common situations where a trust fund makes financial sense.