Should You Use A Pour Over Will?

Let’s say that you were smart, and you made sure that you transferred pretty much everything that you own into trusts. By doing that, you ensure that there will be no probate, and thus, no court action, and thus, hopefully, no infighting between your family over who gets what when you are gone.

But there are still some things that can’t be left in your trust—at least, not now. Maybe that’s because of tax reasons, or you need access to the assets, or for some asset protection reasons. And, of course, as we go through life, we all acquire a lot of stuff. Maybe you left something out, and just forgot to transfer those assets into your trust? What do you do then?

Pour Over Wills

The answer is a pour-over will. A pour over will allows, on your passing, everything else that you own, to automatically be transferred into your trust.

The good thing about a pour over will, is that you don’t have to specifically identify and name every item that you own, and specify what gets put into the trust. General terms are OK, and will serve to make sure that what you own is put into the trust.

By using a pour over will, you will ensure that all your assets go into a trust, and thus, are free from the court probate process.

You can just have a pour over will, and nothing else (other than the trust that’s accepting the assets)–for example, if you don’t want to specifically leave anything to anybody, you can opt to just have a simple will that pours everything you own on death, into a trust.

When to Make the Trust?

It used to be that a pour over will was only valid, if the trust that was accepting the assets was created before or at the time of the making of the will. That’s no longer the case. However, the law does require that the trust that will accept the assets being “poured over” from your will, be created within 60 days after the execution of the will—that means, you will have to act fast, and have a strategy for both.

Note that should you revoke the trust where the assets will be going into, the pour over provision of your will not have any legal effect. This could lead to your will being probated—at least, the parts of it that were not otherwise placed into a trust before you passed.

Property That Can’t be Poured Over

Not all property will automatically be “poured over.” Any property held by a trust, cannot be poured over into another trust. Additionally, retirement accounts cannot be poured over. If property is held as joint tenants, where a surviving tenant is still alive, will not be poured over, because the legal transfer to the surviving tenant will take precedence over the pour over provision in your will.

Call the Torrance estate planning attorneys at Samuel Ford Law today to see what documents you need to make your estate plan complete and as thorough as possible.

Source:

investopedia.com/terms/j/jtwros.asp