Funding a trust often involves giving up control of certain resources. An individual may move their home and other personal possessions into a trust to protect those resources from creditor claims and provide support for loved ones or charitable causes. The change in ownership status can protect those assets from future challenges but can complicate life for the trust’s creator.
Oftentimes, funding a trust occurs long before someone dies. However, some people increase the resources included in a trust by arranging to have certain assets transfer after their death. A pour-over will is one way of accomplishing that goal.
What is a pour-over will?
Typically, wills provide instructions about how to distribute the assets in someone’s estate. Most people choose specific beneficiaries for certain assets or arrange for the sale of their property during the probate process.
Others might draft a will so that the remaining assets in their names transfer into a trust after their passing. A pour-over will allows the remaining property in someone’s name to become the property of a trust. Personal property, furniture, vehicles and other resources not already included in a trust can transfer to the trust as part of the probate process.
Assets transferred using a pour-over will contribute to the total taxable value of the estate and can be vulnerable to creditor claims. However, using a pour-over will is one feasible way to keep family members from fighting over any remaining assets after someone dies.
People can simply and effectively address their residuary estates without worrying about conflict among their beneficiaries over personal property after their passing. Ultimately, adding the right paperwork to an estate plan can make it much easier for someone to achieve specific legacy goals.