So, what are your intentions or plans regarding your asset management? You first need to establish a living trust to have all your assets transferred or owned by your revocable living trust.
The establishment of your living trust often does not facilitate the proper functionality of the trust unless ownership of your assets is successfully transferred to it.
In the case of international assets owners, who want to add foreign assets to your living trust, you should understand that once you make that transfer, all your assets will officially have a new owner.
Funding a living trust means that your assets are transferred to the trust and are officially owned by it so the trust can function as you intended it to.
Firstly, the big idea of funding a living trust simply means transferring your assets to the trust; however, you are still in complete control of the functionality of the trust.
Setting up a living trust is an arrangement for individuals or organizations to manage assets to benefit the asset owners. Note there are various kinds of trusts for different assets, with specific objectives.
Before we dive into how you manage your foreign or any other assets using a living trust, let’s define a living trust. Have you ever wondered how assets get transferred and to whom after the asset owner expires?
A living trust is a document with certain declarations regarding who your assets will be transferred to after you expire. A living trust is also known as a revocable living trust or inter-vivos trust.
On the contrary, there is an irrevocable trust, that sets it aside from a revocable living trust. Moving assets out of an irrevocable trust imply that you are not allowed to transfer assets from the trust as easily. For instance, you will have to gather supporting documents to show that all the beneficiaries involved in the trust have agreed for you to transfer an asset from the trust.
There are other types of trusts that are only functional after your demise, plus, they are irrevocable, which basically means that no one has the authority to change it, including the successor trustee.
On the other hand, a living trust allows you to fully possess all your trust assets. You are free to take out or add assets, and make changes to beneficiaries – change, add, and remove trustees too.
When you expire, the assets you own are transferred to your beneficiaries immediately without the involvement of other parties. Once your assets are successfully transferred to the beneficiaries, the trust is made kaput.
Transferring your assets to a living trust suggests that you legally change your assets’ ownership. It is common for the owner of assets of the living trust to be the trustee themselves. This helps to control the functionalities of the assets, but according to the standard terms, the assets will still be owned by the trust.
It’s important to remember that all your foreign assets will still be assigned using your social security number. So, having a list of everything you own per your living trust, is vital for making any ownership transfers.
Your home or other real estate property is more likely to be transferred into your living trust. You much check the state laws of the country in which you have ownership of the property. Usually, all you need is a deed, a legal document to prove the transfer of your property to the trust. The quickest way is to prepare a quitclaim deed, which you can do by yourself.
It’s important for you to seek your attorney’s expertise to determine the most suitable deed for your situation. Keep in mind, that some states do not entertain a self-help method, all the deeds have to be legally prepared by certified attorneys. The next step is to submit it to your county, which has filing charges too.
After completing your deed transfer, you may have to look into changing the property owner’s insurance policy, as your trust will automatically become the new owner of your property. This might be tricky, as there are different types of real estate insurance, hence the conditions applied may also differ.
Transferring automobiles such as cars, trucks, and vans to your trust requires you first to find out if your state has the option for your trust to possess ownership of your vehicles.
Contact your vehicle insurance company to confirm the terms and conditions of your current insurance policy. Check if anything is supposed to change in terms of coverage, once ownership of the vehicle transfer is made.
Lastly, follow all the procedures to make this transfer successful.
Local or foreign financial assets may include bank accounts, investments, stocks, etc. In order to transfer such assets, you have to get in touch with the organization that’s related to your financial asset. In this case, it can be your bank or any other financial institution. For stocks, you have to dig deep into the mechanics of the stock market.
Fill out the paperwork carefully, and follow instructions to ensure it is completed smoothly.
Tip: You may consider keeping your personal bank account, or saving accounts out of this.
Personal properties may include items you have in your home, such as furniture, laptops, jewelry, collectibles, or anything else you feel is valuable. In this case, it would probably be the possessions in your foreign home. You can transfer them to your living trust fund by listing them in your trust document. Please note that if any of your belongings declared in your trust document are insured, you must make sure that the insurance is also transferred to the trust.
To conclude, transferring foreign assets to your living trust as soon as possible has certain benefits. It’s ideal to purchase your assets as the trustee so they are automatically transferred to your living trust by default.
Hopefully, with this list, you can successfully add foreign assets to your living trust to ensure your affairs are all in order. Good luck!