We have a meeting set up with our family attorney to discuss putting some assets into a trust. Obviously his expertise is what we will lean on in progressing, but I like hearing first hand accounts of people who have went through the steps already. I know a lot of the regulars here own acreage for hunting and whatnot. How many of you have went this route with hunting/ag land and properties?
We have been debating setting up a trust….do you mind if I ask why you are doing it? I think it is a great tool under the right circumstances, but not for everyone.
I believe its just to avoid probate right?
I believe its just to avoid probate right?
Can also help navigate estate taxes depending on the size of the trust. But yes probate is big time and cost depending how messy someone’s will is, or lack of will. You pay on the front side creating the trust, but makes life 10x easier for the trustee/beneficiary.
I assume your doing a revocable/living trust to have control over your property still? Working where I do I see alot of attorneys neglect to use the Vin numbers of vehicles in the trust. In MN you cant transfer using a trust unless it states the VIN. Keep the name short. The entire name of the trust must be used on all components so it can be a pita. Don’t expect people not listed in the trust to be able to do trust business. Even down to writing a check for insurance or renewing boat reg.
MN taxes estates over $3 million. Having a trust avoids some of the taxes. Also no probate. Our trust activates on the death of myself or my wife. Put all your assets into the trust. The surviving spouse is the beneficiary of the trust until their death, then further direction is in the will. Our home, acreage, and all financial accounts go into the trust. It cost us $2500 to get it all set up. Much easier for the kids after we are both gone. Do a will at the same time, as they are connected.
It mainly helps to avoid probate – or at least at the surface level we’d start with. There’s also more privacy to asset allocations than say a traditional will and the probate process. One other advantage/layer of protection that I’m not sure if it will apply is from litigious situations. If someone sues ME, but I don’t own the property hopefully that either protects the assets or removes the desire to attempt to sue all together? It seems we’d have to consider the irrevocable trust for that extra benefit – which doesn’t make sense for us quite yet with young children. I know people use trusts to protect assets from creditors (You end up in a long term care facility, have a disabling life event, etc.). With an irrevocable trust there’s nothing to go after or liquidate.
You can fine tune the trust (from my understanding) to handle most of your assets and how they’re distributed. You can also manage/assign future charitable donations from it.
Some of the thresholds for taxing estates seem high, but when you factor in land that appreciates + life insurance policies it really doesn’t take considerable wealth to hit the parameters where the government starts taking more and more of what you spent your life earning. This is another part I need to learn more about (or if it’s even a possibility to avoid estate taxes).
We just started looking into this too, and I’ll be following along. The only thing I have to add, is to make sure your beneficiaries and trust all match up.
Working where I do I see alot of attorneys neglect to use the Vin numbers of vehicles in the trust. In MN you cant transfer using a trust unless it states the VIN.
Including the VIN in the trust is not required by Iowa. We have the vehicle registered in the name of the trust(s) and that is sufficient.
MN taxes estates over $3 million. Having a trust avoids some of the taxes. Also no probate. Our trust activates on the death of myself or my wife. Put all your assets into the trust. The surviving spouse is the beneficiary of the trust until their death, then further direction is in the will. Our home, acreage, and all financial accounts go into the trust. It cost us $2500 to get it all set up. Much easier for the kids after we are both gone. Do a will at the same time, as they are connected.
Great info. I would also include keeping an updated healthcare directive . With HIPAA and other privacy acts, even your spouse may have trouble accessing your medical records or acting in your best interest if you become incapacitated.
A good trust/will will protect your kids and spouse in the case of a death and re-marrying (if you chose to do so, personal choice)
EX- Bob’s wife dies. Bob ends up re-marrying Jill and he names Jill his new trustee. Bob passes and all asset’s go to his surviving wife Jill and eventually her kids. Bob’s kids get nothing.
Very basic and blunt example but you get the point, plenty of legal articles and posts on google going into detail about this situation.
A book that helped us when we were researching living trust was “Living Trusts for Everyone” by Ronald Farrington Sharp.
We chose to set up individual trusts vs a joint trust in case estate tax limits were ever lowered enough to affect use, to protect assets from remarriage or squander, to avoid the expense/public nature of probate and to make it easier on the trustee after our death. At the same time we set up a health care power of attorney, a general power of attorney and a will. The primary purpose of the will is to capture any belongings that are not titled/registered in the name of the trust (e.g., furniture, sporting goods, vehicles not titled in the name of the trust, etc.
My farm will go into a trust for my sons.
Benefits that I was looking for, at least as they were explained to me:
– Estate/taxes/etc as already mentioned.
– Protection from future issues as they relate to…
If one (or God forbid both) of my sons would get divorced, the farm is NOT an asset they own part of and therefore it(or its value) is not part of a divorce settlement as it would be if they would inherit it directly in their own names.
This divorce thing is a major issue with co-owned hunting properties. One of the “partners” in a property gets divorced and the Ex demands he sell “his share” of the partnership property because she wants her cut. Bad situation. I had one customer that had to bail out his hunting partner on a deal like this, they owned a property in IL and then his co-owner’s wife hit him with a divorce. The property value had risen significantly and basically he had to buy his partner’s share out so that the poor guy could then hand over half the proceeds of his dream hunting spread to his ex wife. Bad, bad, bad.
My understanding is also that the farm can’t be seized by creditors in the event of a son filing for bankruptcy because it’s not an asset that they personally own or even own half of.
– Laying down the law as far as how the farm is to operate after I’m gone. I will fund operating expenses from my estate, but the trust lays out who can do what and how it must be done. It also lays out future use rules and if/how the property would be sold if it came to that.
The biggest thing is that it makes me “the bad guy” in terms of how the property is used and by whom. That way my sons are not under pressure in the future to make those decisions themselves, they can just say that this is the way it is because dad wanted it this way and that’s the end of it.
Our Trust goes to bloodline only..
We have no kids
My Sister’s and then her kids not to their spouse
One new thing I’ve started seeing a lot of people do these days is called a Transfer on Death Dead ( TODD for short ) This keeps the home out of probate and avoids tax. One thing to note in doing one of these on a home, the ownership of the home passes Immediately upon death to the new owner. Make sure that the new owner is aware of that and secures their own Insurance right away on the home. Due to a landmark supreme court ruling here in Minnesota. A insurance companies obligation to the prior owner does not carry through directly to the new owner at death. This is far different than if no TODD was in place. Without the TODD the obligation remains with the estate for a period of time to allow time to sell or transfer the the property to a new owner. It was crazy supreme court case. A guy owned a home up in the Tofte / Grand Marais area. The guy had a live in girlfriend. Shortly prior to the guys death he had a TODD put into place to transfer ownership to his niece I believe. The live in girl friend was not aware of this and believed the house was going to be her when the guy died. When the girlfriend found out the home was going to the niece and not her, She burned the house down. Sadly the insurance company refused the claim saying on his death and transfer of property ownership to the niece they had not obligation to the new owner. The case went to the Minnesota Supreme court and the court sided with the insurance company and the niece was left with nothing. Just something to be aware of if you have done or are thinking of doing a TODD
All I can say is – “Get an Attorney!!!”
Trust me, I’ve been through 2 divorces and parents/in laws passing away and most didn’t turn out well for the intended recipients.
However a fishing website does has a lotta experts. 
this TODD also avoids alot of attorney fees. going through moms will and all that crap..we have $7500.00 in attorney fees and probate isnt done yet.
i do agree with EPG though even with the TODD i’d get an attorney to help navigate.
EPG……lotz of experts here!!!!! 
dats funny!!!!! 
Almost as if the first sentence of the original post didn’t highlight that before asking…
I like hearing first hand accounts and average Joe’s opinions on things while taking it for face value
We have a meeting set up with our family attorney to discuss putting some assets into a trust. Obviously his expertise is what we will lean on in progressing, but I like hearing first hand accounts of people who have went through the steps already. I know a lot of the regulars here own acreage for hunting and whatnot. How many of you have went this route with hunting/ag land and properties?
EPG……lotz of experts here!!!!! rotflol rotflol dats funny!!!!! waytogo
for sure!!!
This is a great topic! My wife and I looking into doing this same thing.
And remember
“95% of all attorneys give the other 5% a bad name”
A few years after my wife passed away, I set up a revocable trust. Everything goes to my 2 kids. I can specify that certain things go to others if I want, like all my fishing stuff goes to … Also did the health care directive and power of attorney at the same time. Worked with an attorney who specializes in this area who works closely with my financial advisor’s company. If I remember correctly, ~$2200.
My in-laws put their lake home in Western Michigan into a trust with my wife and her three siblings as beneficiaries. FIL and MIL are now gone, kids are coming to alignment on selling the lake place (sister in Las Vegas, brother in Chicago with a place near Lake Geneva, WI, brother who can’t swing the place on his own and us in the Twin Cities). The trust kept things stable until the beneficiaries could figure out what to do. I strongly recommend a trust for real estate.
Also, consider your options with your attorney. The attorney who handled the trust, wills and other documents was great. He retired, we ended up having to deal with a successor partner who sucked. Keep and eye on what goes on with your attorney (doctor, dentist, etc.) to ensure you have the representation you desire for the long term.
Aren’t you also protecting the assets in the event that someone enters the nursing home? They can seize assets to pay for care, which can be really spendy.
Aren’t you also protecting the assets in the event that someone enters the nursing home? They can seize assets to pay for care, which can be really spendy.
I don’t think it protects the assets if it is a living trust.
Almost as if the first sentence of the original post didn’t highlight that before asking…
I like hearing first hand accounts and average Joe’s opinions on things while taking it for face value
<div class=”d4p-bbt-quote-title”>buckybadger wrote:</div>
We have a meeting set up with our family attorney to discuss putting some assets into a trust. Obviously his expertise is what we will lean on in progressing, but I like hearing first hand accounts of people who have went through the steps already. I know a lot of the regulars here own acreage for hunting and whatnot. How many of you have went this route with hunting/ag land and properties?
When we had our trusts put together we went thru 2 attorneys before we bit the bullet and paid for someone that specialized in trusts. When we contacted the first two, we explained what we were looking to do and both said they could do it. After a short period of time it was obvious that was not the case. Admittedly, ours was a little different than most trusts but the devil is in the details and it can be worth paying a bit extra up front.
I am not a trust attorney but am allowed to play one on IDO…
With that said we set ours up when we bought a second property out of state. We were told that having our properties in the trust avoided probate in the second state. Take that for what it worth, but if you own property in multiple states you might consider a trust.
I am not a trust attorney but am allowed to play one on IDO.
Now that’s funny right there.
And soooo many things can be substituted for “attorney”
We’re in the process of doing this right now. We are doing revocable trusts with “disclaimer” provisions. The disclaimer allows you to split your assets so that your beneficiaries avoid the estate tax penalty that comes after 3 million in total assets. When done this way (as I understand it) the estate is basically divided in half…I will own my 1/2 and my wife the other. Whoever dies first, their 1/2 goes into a seperate trust that the surviving spouse can still access but it’s technically not in “their” trust. In our case, we are basically at 3 million +/- right now and we assume this is going to go up. Everything above that 3 million gets taxed by MN at 15%. For example, if we end up around 3.5 million in total assets when the last of us dies, our heirs would be paying about $75K in taxes on that extra half million! That’s at todays figures…I doubt it will go down in the future. I’m sure I’m explaining it poorly but it made sense when the attorney explained it.
My wife and I set up a trust with our three kids as equal beneficiaries. Also did a will and health care directive. Get a good lawyer! Couple of things to add to what’s already been discussed.
While morbid, our lawyer had us write a letter to our children/heirs explaining in greater detail how we wished for our assets to be divided (e.g. two want to keep the family cabin, while one lives on the west coast and will almost never use it) and other issues that heirs might have questions about post-mortem. The letter accompanies our will and tries to make our wishes very clear in areas that might be murky.
Also, having been through this and experienced firsthand the incredible amount of time and work involved, we left extra $$$ for the child who has been designated ‘Executor’ to liquidate our estate. Doing so will be no easy task and is deserving of extra compensation for their time and effort. We were generous here, knowing that the liquidating our estate could be a year or more of massive hassles to get everything sold and squared away.
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