The question of whether a revocable trust can own a checking account is a common one for individuals exploring estate planning options with an attorney like Steve Bliss. The simple answer is yes, a revocable trust absolutely can—and often should—own a checking account. This is a crucial step in properly funding the trust, meaning transferring assets into it so the trust can effectively manage and distribute those assets according to the grantor’s wishes. A trust is, in essence, a legal entity, and like any legal entity, it can hold assets, including cash in a checking account. Failing to properly fund a trust is a surprisingly frequent mistake, rendering much of the estate planning work ineffective; studies suggest over 60% of trusts are never fully funded.
What happens if my trust doesn’t have its own bank account?
If a revocable trust doesn’t have its own checking account, managing assets becomes significantly more complicated after the grantor’s incapacity or death. Assets would likely remain titled in the individual’s name, potentially triggering probate – a potentially lengthy and costly court process – to transfer ownership. Probate fees typically range from 3-7% of the estate’s value, depending on the state. Consider the story of old Mr. Henderson, a carpenter known for his meticulous work and equally meticulous hoarding. He created a beautifully crafted revocable trust with Steve Bliss years ago, but never bothered to change the titles of his various accounts. When he fell ill, his family struggled to access funds for his care, battling legal red tape and incurring significant expenses just to cover his immediate needs.
How do I open a checking account for my trust?
Opening a checking account for your trust is similar to opening a personal account, but requires a bit more documentation. You’ll need to provide the bank with a copy of the trust document itself, demonstrating the trustee’s authority to act on behalf of the trust. You’ll also need the trustee’s identification and Social Security number. Many banks now have specific procedures for trust accounts, so it’s best to inquire beforehand about any unique requirements. Banks often ask for a ‘Certificate of Trust’ which summarizes key information from the trust document; this ensures the bank knows who is authorized to act on the trust’s behalf and minimizes potential liability. The trustee is then identified to the bank as the individual authorized to deposit and withdraw funds, sign checks, and conduct other banking transactions.
What’s the difference between a trustee and a beneficiary with regards to bank accounts?
The trustee is the person or entity legally responsible for managing the assets held within the trust, while the beneficiary is the person who ultimately benefits from those assets. The trustee, acting in their fiduciary capacity, controls the checking account, making decisions about how funds are used according to the terms of the trust. Beneficiaries do not have direct access to the checking account; rather, the trustee disburses funds to them as outlined in the trust document. This separation of control is a key feature of a trust, providing asset protection and ensuring funds are used responsibly. Consider Mrs. Davison, a widow who established a trust to provide for her grandchildren’s education. She designated her daughter as trustee, ensuring the funds would be managed prudently and used solely for educational expenses.
Can I still access the money in the trust account as the grantor?
Absolutely! As the grantor, you typically serve as the initial trustee of your revocable trust, allowing you complete control over the assets, including the checking account. You retain the right to deposit and withdraw funds, pay bills, and make any other transactions you would normally do with a personal account. The “revocable” aspect of the trust means you can change the terms, add or remove assets, or even terminate the trust altogether during your lifetime. This flexibility is a major benefit of revocable trusts. However, everything changed for Mr. Henderson’s family. They were able to swiftly access funds to cover medical bills and legal fees because the trust, though initially unfunded, was properly set up with a mechanism to allow for swift transfer of assets upon his incapacity. The trust document outlined a clear process for transferring ownership of assets from his individual name to the trust, and Steve Bliss had provided guidance on how to do this efficiently.
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About Steve Bliss Esq. at The Law Firm of Steven F. Bliss Esq.:
The Law Firm of Steven F. Bliss Esq. is Temecula Probate Law. The Law Firm Of Steven F. Bliss Esq. is a Temecula Estate Planning Attorney. Steve Bliss is an experienced probate attorney. Steve Bliss is an Estate Planning Lawyer. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Steve Bliss Law. Our probate attorney will probate the estate. Attorney probate at Steve Bliss Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Steve Bliss Law will petition to open probate for you. Don’t go through a costly probate. Call Steve Bliss Law Today for estate planning, trusts and probate.
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
estate planning
living trust
revocable living trust
family trust
wills
irrevocable trust
Map To Steve Bliss Law in Temecula:
https://maps.app.goo.gl/RL4LUmGoyQQDpNUy9
Address:
The Law Firm of Steven F. Bliss Esq.43920 Margarita Rd ste f, Temecula, CA 92592
(951) 223-7000
Feel free to ask Attorney Steve Bliss about: “What should I consider when choosing a beneficiary?”
Or “What happens if the will names multiple executors?”
or “What professionals should I consult when creating a trust?
or even: “Can I keep my car if I file for bankruptcy?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.