TRUST BASICS: HOW DO YOU ESTABLISH A TRUST?

Trust law is state specific, and Florida Statutes Section 736.0402(1) provides certain basic requirements to establish a trust:

1. The settlor has capacity to create a trust.
2. The settlor indicates an intent to create the trust.
3. The trust has a definite beneficiary or is:
   1. A charitable trust;
   2. A trust for the care of an animal, as provided in s. 736.0408; or
   3. A trust for a noncharitable purpose, as provided in s. 736.0409.
4. The trustee has duties to perform.
5. The same person is not the sole trustee and sole beneficiary.

The trust agreement does not need to be filed; you can specify in your trust agreement that the trust is private so that only the Grantor, Trustees, and perhaps the beneficiaries can see it.  But a Certificate of Trust or an Affidavit of Trust will be needed to certify the existence of the trust and show who has the authority under the Trust as the named Trustee(s).  A Florida attorney that specializes in estate planning will ensure that a private trust is created if that is your intent and also that you have all of the documentation you need to move forward in funding the trust (moving assets into the trust’s name).

The trust can be “funded” through a Will, at the settlor or trustor’s death, or by directly making the trust the owner of the assets by transferring those assets immediately.  Any assets that are owned by the trust at the time of one’s death are not probate assets.  However, if the will directs that assets go into a trust at one’s death, then those assets are still part of the probate estate.

This is an important distinction if one’s goal for the trust is to avoid probate and protect assets from creditors at one’s death.  Also, in order for there to be consideration for the creation of the trust agreement, something of value must be transferred to it at the time it is created.  At Longa Law, we always direct clients on how to fund the trust immediately.  We also prepare and file deeds for any properties that will be owned by the Trust.  We even work with a network of attorneys in other states so that we know each deed is properly prepared in accordance with the laws of that particular state.  This is especially helpful so that heirs do not have to file probate in multiple estates or pay probate estate attorney’s fees and court costs.

If you have any questions about how to create a valid trust or how to fund a trust, please contact Longa Law Firm for a free attorney consultation.