A living trust, or "inter vivos" trust, is a trust that is created by the grantor during the grantor's lifetime, rather than upon the grantor's death.
Living trusts are designed to avoid probate proceedings. Probate simply refers to the court-administered process of paying debts and distributing property to heirs upon one's death. This is a very timely and costly process. Heirs can often expect to wait months before receiving anything, and by the time they do, the assets have been diminished significantly by court costs and attorney's fees.
Other common reasons to create a living (also called a lifetime) trust include reducing taxes, ensuring financial privacy, and regulating the use of assets (in case the owner becomes incapacitated).
Some of the requirements of a New York lifetime trust are as follows:
- Every trust must be in writing and must be executed and acknowledged by the person establishing the trust.
- Meet the witness requirements (by one trustee, or two witnesses that are not trustees).
- Amendments should be in writing and executed by the person authorized to make changes in the governing instrument.
- Written notice of changes must be made to the trustee within a reasonable time.
As you can see, the requirements for a New York living trust have various complicating factors. As such, the best thing to do is to have a local trusts and estates attorney at hand to help guide you through the nuances.
For more information on the topic of New York living trusts or New York lifetime trusts, please see the resources below.