» » Alabama Living Trust Forms – Irrevocable & Revocable

Alabama Living Trust Forms – Irrevocable & Revocable

The Alabama living trust is a document that places a Grantor’s assets into an entity to be distributed to a Beneficiary after the Grantor dies. During the Grantor’s lifetime, they may be able to designate themselves as the person who takes advantage of any interest or income from the assets or property. Depending on the type of trust created, it can have the power to shield the Grantor from creditors (Irrevocable) or allow them to change the trust at any time (Revocable). Both types allow the parties to bypass the probate process in Alabama.

Laws – Title 19, Chapter 3B (Alabama Uniform Trust Code)

Will (Last Will and Testament) – Creating a Will is recommended as it can transfer all assets not mentioned in the Living Trust to the heirs of the Grantor’s choice. All property in a Will must go through the probate process in Alabama.

Types

Irrevocable Living Trust – Cannot be edited after it is created but offers estate and income tax advantages, such as avoiding estate taxes at the time of the Grantor’s death.

Revocable Living Trust – Can be edited at any time and enables the Trustee (often the Grantor) to transfer assets and property in and out of the trust at will.

Individual Roles

There are four (4) major roles:

Grantor (or “Settlor”) – The maker of the trust.

Trustee – In charge of the assets and property placed in the trust during the lifetime of the Grantor. This is commonly the same person as the Grantor in a Revocable Trust. In an Irrevocable Trust, the Grantor cannot also be the Trustee.

Successor Trustee – Becomes the active Trustee in the event of the incapacity or death of the initial Trustee.

Beneficiaries – The individuals that will inherit all property and assets from the Grantor upon their death.

How to Make a Living Trust in Alabama

In accordance with § 19-3B-402 regarding the creation of a Living Trust, the Grantor needs to be of mental capacity when signing the document and authorizing that creation of the entity. This means that they cannot be incapacitated and must be thinking with a clear mind. Also, the same person cannot be the sole Trustee and Beneficiary. Depending on the nature of the assets and property transferred into the Trust, a Notary Public and witnesses may or may not be necessary; however, they are often recommended. Once the trust has been created and all parties accounted for, the Grantor can then transfer funds and assets into the entity

Motor Vehicles – Any automobile, boat, motorcycle, or any other type must be transferred through an Alabama Bill of Sale.

Real Estate – If property is to be transferred to a Trust, it must be reflected in the County Probate Judge’s Office where it is located. Conducting this transfer requires that an Alabama Deed be completed and filed by the Grantor.

Websites – If there are websites or domain names that need to placed in the Trust, the owner’s information must be reflected in the ICANN / WHOIS database. This can be done by changing the settings with your registrar (such as GoDaddy).

Do I Need a Living Trust in Alabama?

Under the laws in Alabama, § 43-2-692, unless an individual has a net worth of more than twenty-five thousand dollars ($25,000) the deceased’s estate needn’t be distributed through the probate process. A Living Trust should be used however if the Grantor wishes to transfer specific assets to specific Beneficiaries. Otherwise, the heirs can fill in a Small Estate Affidavit which will allow the family to bypass the probate process and immediately take possession of the decedent’s assets.


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