How Do I Fund a Trust in Kansas?

Estate planning is all about safeguarding your wishes for the future.  While creating a trust is a significant first step, it’s just as important to understand how to fund that trust with your assets.  This ensures your intentions are carried out exactly as you planned.  Let’s break down the process of funding a trust in Kansas, making it clear and easy to understand.

Understanding Trust Funding in Kansas

Think of funding a trust as putting things away for safekeeping.  Here in Kansas, funding a trust involves transferring ownership of your assets from your name to the name of the trust.  This includes real estate, bank accounts, investment accounts, vehicles, and personal property.

What Assets Can Be Funded in a Trust?

The good news is that a wide range of assets can be placed in a Kansas trust. Here’s a quick rundown:

• Real Estate: This could be your primary residence, a vacation home, or even undeveloped land. To fund your trust with real estate, you must prepare a new deed with the trust named as the owner. This typically involves working with a title company or real estate attorney to ensure the deed is accurate and filed correctly.
• Financial Accounts: Checking accounts, savings accounts, and investment accounts (like IRAs or brokerage accounts) can all be funded into your trust. You’ll typically need to contact the financial institution holding the account and follow their specific procedures for changing ownership. This might involve submitting a form or visiting a branch in person.
• Vehicles: Funding your trust with a car, boat, or motorcycle involves updating the title paperwork to reflect the trust as the owner. The Department of Motor Vehicles (DMV) in Kansas will have specific steps to follow. These involve submitting a completed title application, proof of insurance, and any required fees.
• Other Personal Property: While it might not be typical, you can include valuable personal belongings like artwork, jewelry, or collections in your trust. This might involve creating a detailed inventory that becomes part of your trust document. The inventory should include descriptions of the items, estimated values, and any specific instructions for distribution to beneficiaries.

Benefits of Funding Your Kansas Trust

There are several advantages to adequately funding your Kansas trust:

• Avoids Probate: Assets held within a funded trust generally avoid the probate process, which can be time-consuming and expensive. Probate is the legal process of distributing assets according to a will or through state intestacy laws (if there’s no will). By funding your trust, you ensure your assets are distributed more efficiently according to your wishes.
• Manages Incapacity: If you become incapacitated due to illness or injury, the trust can continue to be managed according to your instructions. The designated trustee you named in the trust document will handle the assets for your benefit and according to your wishes.
• Protects Assets: Depending on your trust, it can offer some protection from creditors or lawsuits. An irrevocable trust, for instance, can shield assets from claims against you.
• Provides Flexibility: A revocable trust allows you to retain control over the assets during your lifetime. You can make changes to the trust, add or remove assets, or even revoke the trust altogether

Considerations When Funding Your Kansas Trust

There are a few key things to keep in mind when funding your Kansas trust:

• Beneficiary Impact: Be sure you understand how funding-specific assets will affect your beneficiaries. For example, funding a retirement account with your trust might have tax implications for your beneficiaries. It’s always wise to discuss these details with your estate planning attorney.
• Joint Ownership: If you own assets jointly with someone else (like a spouse), discuss your intentions with them before funding the trust. Their cooperation might be needed to transfer ownership. For instance, if your home is titled jointly with your spouse, you’ll likely need their signature on the new deed transferring ownership to the trust.
• Maintaining Control: Depending on your trust (revocable or irrevocable), you still retain control over the assets even after they’re funded in the trust. A revocable trust allows you to change or remove assets throughout your lifetime. On the other hand, an irrevocable trust generally involves giving up some control over the assets in exchange for potential tax benefits. Discuss this with your estate planning attorney to determine which type of trust best suits your needs.

Tax Implications of Funding a Trust in Kansas

It’s important to note that funding your trust in Kansas might have tax implications. These can vary depending on the type of assets you transfer and the type of trust you have. For instance, there could be capital gains taxes on the sale of assets held within the trust. Additionally, some retirement accounts might have different tax rules when placed in a trust.

Contact an Experienced Estate Planning Attorney in Kansas

While we’re always on hand for urgent situations, the typical process from consultation to finalizing the paperwork usually spans a month.  To ensure a seamless and stress-free experience, contact The Law Office of Andrew Rowe, P.A. today at 316-202-0131 or schedule a consultation online.  We’re dedicated to helping you confidently go through the legal aspects of estate planning in Kansas.