Look Into Pour Over Will
A pour over will is a legal form created to manage assets or property that were left out of a living trust. A living trust provides the grantor, or settlor, that ability to transfer control of his or her property to a trustee. This trustee then manages the assets or property for the beneficiaries of the trust during the settlor’s lifetime.
A pour over will, then, goes through probate court after the testator’s death. After probate, any property that has not been assigned to beneficiaries of the will will spill over into the living trust to the beneficiaries of the trust. Pour over wills work differently than testamentary trust wills, which are wills that create a trust after the death of a testator.
Instead, the testator of a pour over will has created the trust before his or her death, generally before or during the drafting of the will. This created trust is linked to the will through the contents of the pour over will, but can exist on its own. Pour over wills, however, can not function correctly without the presence of a legitimate living trust to “pour” extra assets into.
This specific type of will allows people to avoid inconvenience of dealing with complicated property. For example, some properties are much more difficult to manage in a trust than in a will, such as a car. Additionally, the use of these wills can provide a tax benefit, especially for assets that do no particularly fit well in the structure of a trust. Transfer of some of these assets may lead to an additional taxing of the assets.
Additionally, these wills can cover newly acquired assets that may not have been added to the will. For example, if an individual acquires a new, expensive car a few years before his or her death, he or she may have forgotten to change the will to include the newly acquired car.
Pour over wills will automatically transfer these assets to the linked living trust, therefore avoiding the creation of intestate succession, the state laws’ take on how property should be distributed. A pour over will is highly recommended when a trust is present, as it can act as insurance for the distribution of property after death.
Some jurisdictions, however, do not recognize the validity of these types of wills. Additionally, the existence of a pour over will guarantees that the process of probate will be required. Probate can cost the trustee, executor, and family members a lot of time and money.
A pour over will can act as a safety blanket for assets not specifically added to a living trust. In situations where a trust is present and active, these wills can be more necessary than many people realize.