A living trust, sometimes call a revocable trust, is a written legal document through which your assets are placed into a trust for your benefit during your lifetime.
Why Do I Want This? In the State of North Carolina, a living trust is a great estate planning tool that allows you to have your assets owned by your trust during your lifetime and distributed after your death, or while you are still living. This type of trust is very flexible and provides you with the capability to make changes as you choose. A living trust will keep your assets from having to go through probate. Probate is the court process in which a will is verified and carried out. This process can take months to accomplish and cost copious amounts of fees. Also, having the ability to bypass probate means that your assets can be distributed immediately after your death, rather than after the entire probate process. How Does It Work? In order to create a living trust in North Carolina, you must complete the trust document and sign it in front of a notary. After completing the trust document, you must then transfer ownership of your assets into the trust for it to be affective. You, the grantor, will be the one in charge of setting up your living trust. When you establish such a trust, your assets will be owned in the name of the trust. In order to gain as much benefit from this trust as possible, it is advised to transfer all of the assets you can into the trust. This trust will be managed during your lifetime by the trustee. More often than not, that trustee is you. Along with the initial trustee, you must name a successor trustee to take over the trust after your passing. The successor trustee will then be in charge of continuing to manage your assets, as well as distributing them to your beneficiaries according to the terms you specified.
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Constructing a last will and testament is an integral part in planning the distribution of an individual’s estate after their death. In the State of North Carolina, wills give the testator (the person writing the will) the chance to make sure that their spouse, children, other family members, and even pets are taken care of after they die. While embarking on the process of constructing a will, it is crucial that a testator knows and understands the laws associated with wills in their state. Otherwise, the chances of their will being invalid increase. An estate planning attorney is an invaluable tool in the process of constructing a will because they can use their advice and experience to ensure that a will is valid. This article will explore, North Carolina laws regarding wills, the effects of dying with a will and dying intestate, and the different types of wills in North Carolina.
North Carolina Laws Regarding Wills Every state has its own specific statues when it comes to wills. A will that fails to adhere to North Carolina’s statues are generally considered to be void, making the state dispose of the testator’s property according to the rules of inheritance. This gives the property to the testator’s most immediate kin regardless of the testator’s wishes. For this reason, it is ill advised to simply assume that a will is valid, an attorney can assist an individual in the process of ensuring that their will adheres to North Carolina’s standards. Below are list of laws regarding North Carolina wills:
Effects of Dying with a Will vs Dying Instate The most important purpose a testator can use a will for is to express how assets such as homes, vehicles, business holdings, and bank accounts should be divided upon the testator’s death. A North Carolina will and testament can also allow an individual to name someone as the legal guardian of their children. In addition to testamentary trust (trust that provides a benefit for people), North Carolina law specifically allows for the creation of trust for the care of animals that are alive during the testator’s lifetime (referred to as pet trust). Such a trust terminates upon the death of the last surviving animal covered by the trust. A person who dies without a will is called intestate, which will invoke the laws of intestacy. In this state, the shares in real and personal property that go to a surviving spouse also depend on whether or not there are also surviving children or parents. If there are no surviving children or living spouse, then intestacy laws grant shares of the decedent’s closets relative. Types of Wills in North Carolina Listed below are a list of wills that are recognized in North Carolina:
A person who dies without a will is referred to have died intestate. The court will distribute the decedent’s estate to the surviving spouse first and then remaining balance will be distributed to the decedent’s descendants by using the Per Capita at Each Generation method. The court follows the intestate rules provided under the North Carolina General Statute (“NCGS”). Spouse’s portion of the decedent’s estate: NCGS 29-14 provides the rules for what portion of real property and personal property the surviving spouse shall receive from the decedent’s estate. Real Property For real property the following rules apply under NCGS 29-14(a). First, if the decedent has no surviving children or grandchildren and their parents are also deceased, then the spouse receives all of the real property. Second, if the decedent has one child or any lineal descendant (grandchild) of a deceased child that has survived them, then the spouse receives only one-half interest in the real property. Third, if there is: two or more children, one child and any lineal descendant of one or more deceased children, or lineal descendants of two or more deceased children that has survived the deceased; then the spouse receives one-third interest in the real property. Lastly, if there are no surviving children or lineal descendants but one or both of the parents survived the deceased, then the spouse receives only one-half of the real property while the remaining portion goes to the surviving parent or parents of the deceased. Personal Property For personal property the following rules apply under NCGS 29-14(b). First, if the decedent has no surviving children or grandchildren and their parents are both deceased then the spouse receives all of the personal property. Second, if the decedent has one child or any lineal descendant (grandchild) of a deceased child that has survived the deceased, then the spouse receives the first $60,000 plus one-half of the remaining balance of personal property. Third, if there is: two or more children, one child and any lineal descendant of one or more deceased children, or lineal descendants of two or more deceased children that has survived the deceased; then the spouse receives the first $60,000 plus one-third of the remaining balance of personal property. Lastly, if there are no surviving children or lineal descendants but one or both of the parents survived the deceased, then the spouse receives the first $100,000 plus one-half of the remaining balance of personal property while the remaining portion goes to the surviving parent or parents of the deceased. Surviving children and lineal descendant’s share: Under NCGS 25-16 provides that the court shall use the Per Capita at Each Generation method to distribute the remaining portion of the decedent’s real and personal property. The Per Capita at Each Generation, provides the initial division of shares of interest is made at the closest generation at which one or more descendants are alive, but the shares of the deceased persons on that generational level are treated as one group and are dropped down and divided equally among the representatives in the next generation. Note that NC does not recognize step-children to take if their step parent dies intestate. However, NC treats half-blood and whole-blood descendants the same. If you would like to speak with an estate planning attorney in regards to drafting a will, please contact Adkins Law for a free estate planning consultation. Adkins Law has offices in Huntersville and Ballantyne for your convenience. |
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