Episode Transcript
[00:00:00] Instead of relying just on the operating agreement of an LLC or just relying on a beneficiary agreement or the terms of a trust agreement in a land trust to make sure his children are taken care of upon his death, we came to the conclusion it would be better to use a revocable living trust. And we often find ourselves talking to our clients and advising them to use a revocable living trust to hold the beneficial interest in their land trust or to hold the membership interest in their LLCs for couple of reasons.
[00:00:45] I had some really good questions today from a client about which would be better to use whenever he is using a land trust or an LLC or any other entity to hold title to his real estate in Florida. And one of the biggest question he had was, well, should I just use a beneficiary agreement with the other owners of the property or should I have a revocable living trust? Because I want to make sure my kids are taken care of should something happen to me.
[00:01:15] And I want my children to have access to the capital that is tied up in this real estate or that's tied up in this llc.
[00:01:23] And going through it, it came down. You know, we talked about instead of relying just on the operating agreement of an LLC or just relying on a beneficiary agreement or the terms of a trust agreement in a land trust to make sure his children are taken care of upon his death, we came to the conclusion it would be better to use a revocable living trust. And we often find ourselves talking to our clients and advising them to use a revocable living trust to hold the beneficial interest in their land trust or to hold the membership interest in their LLCs for a couple of reasons. Number one, as you buy and sell properties, you don't want to have to continually do a new operating agreement to do a new beneficiary agreement regarding the trust. Depending on what is changing with your children. So as your children get older, as you have grandchildren, as things change, maybe something should happen to the children that they need special health care or they have special educational needs. You need to be able to change with the times. So having the revocable living trust is easy because let's say you have 30 different properties in 30 different land trusts and LLCs spread across the state of Florida. And then all of a sudden one of your children is now 30 years old and they have their first child and you go, well, I want to make sure that my grandchildren are taken care of instead of going back and having to amend the documents for 30 different land trusts or LLC documents. You can go back and change this one revocable living trust. We can do an amendment to that to tailor it now to the new situation your family is facing. We can change it to deal with you no longer wanting to be the trustee, you wanting to have an institutional trustee in place. All kinds of different scenarios can come up as you age and as your children age or as your beneficiaries age. And the revocable living trust is very flexible and can be amended pretty easily as you age and as those circumstances change so that we're not having to go back and change the documents under all of these other entities and land trusts that you have out there holding titled all these different properties. Another thing that it does is it helps you avoid probate, which the land trust can do and we can do with the transfer on death of your membership interest in an llc. We can also avoid probate in that way by naming successor beneficiaries in land trust or the transfer on death in the in the membership interest in the llc. However, if you have a revocable living trust as your member or one of your members, or you have the revocable living trust as the beneficiary of your land trust, then that trust becomes irrevocable, potentially upon your death or upon the death of your spouse or however you've set this revocable living trust up. Because again, it's very flexible. And once it becomes irrevocable, it's locked. And at that point, it's locked for your beneficiaries of that trust to be managed and controlled in the way that you want it controlled and the way you wanted it controlled before you died. To clarify exactly how it's going to take care of those beneficiaries, your children, your grandchildren, great grandchildren, however, you have set this up inside of that revocable living trust. So that's the biggest reason we recommend having a revocable living trust.
[00:05:12] If you own a lot of real estate, if you own a lot of LLCs, and of course, the revocable living trust, in addition to owning interest in the LLCs and interest in land trust, can also have bank accounts, it can have crypto accounts, it can have investment accounts, it can hold all kinds of different investments for your children, and it avoids the need for probate so that when you die, it just continues on in a irrevocable form rather than irrevocable form, so that your children or heirs are cared for in the way that you intended prior to your death, so that's definitely food for thought for a lot of our clients out there whenever they're looking at how they want to set up their estate planning as well as their asset protection and those can work together inside of a land trust, an LLC and irrevocable living trust that can become irrevocable upon your death, but prior to your death. Very easy to mold and amend and change according to the way circumstances change as your life progresses. So if anybody ever has any questions, feel free to reach out to us. I'm Joe Siegel, real estate asset protection lawyer here in Florida. If you ever have any questions, feel free to drop comments down below, direct messages, email us, call us or text message. All the information is down in the show notes below. Feel free to reach out. Till then, see you Instead of relying just on the operating agreement of an LLC or just relying on a beneficiary agreement or the terms of a trust agreement in a land trust to make sure his children are taken care of upon his death, we came to the conclusion it would be better to use a revocable living trust. And we often find ourselves talking to our clients and advising them to use a revocable living trust to hold the beneficial interest in their land trust or to hold the membership interest in their LLCs for a couple of reasons. Number one, as you buy and sell properties, you don't want to have to continually do a new operating agreement to do a new beneficiary agreement regarding the trust, depending on what is changing with your children. So as your children get older, as you have grandchildren, as things change, maybe something should happen to the children that they need special health care or they have special educational needs. You need to be able to change with the times. So having the revocable living trust is easy because let's say you have 30 different properties in 30 different land trusts and LLCs spread across the state of Florida. And then all of a sudden one of your children is now 30 years old and they have their first child and you go, well, I want to make sure that my grandchildren are taken care of. Instead of going back and having to amend the documents for 30 different land trusts or LLC documents, you can go back and change this one revocable living trust. We can do an amendment to that to tailor it now to the new situation your family is facing. We can change it to deal with you no longer wanting to be the trustee, you wanting to have an institutional trustee in place. All kinds of different scenarios can come up as you age and as your children age or as your beneficiaries age, and the revocable living trust is very flexible and can be amended pretty easily as you age and as those circumstances change, so that we're not having to go back and change the documents under all of these other entities and land trusts that you have out there holding titled all these different properties. Another thing that it does is it helps you avoid probate, which the land trust can do and we can do with the transfer on death of your membership interest in an llc. We can also avoid probate in that way by naming successor beneficiaries in land trust or the transfer on debt death in the membership interest in the llc. However, if you have a revocable living trust as your member or one of your members, or you have the revocable living trust as the beneficiary of your land trust, then that trust becomes irrevocable, potentially upon your death, or upon the death of your spouse, or however you've set this revocable living trust up. Because again, it's very flexible. And once it becomes irrevocable, it's locked. And at that point, it's locked for your beneficiaries of that trust to be managed and controlled in the way that you want it controlled and the way you wanted it controlled before you died. To clarify exactly how it's going to take care of those beneficiaries, your children, your grandchildren, great grandchildren, however, you have set this up inside of that revocable living trust. So that's the biggest reason we recommend having a revocable living trust.
[00:10:36] If you own a lot of real estate, if you own a lot of LLCs, and of course, the revocable living trust, in addition to owning interest in the LLCs and interest in land trust, can also have bank accounts, it can have crypto accounts, it can have investment accounts, it can hold all kinds of different investments for your children, and it avoids the need for probate so that when you die, it just continues on in a irrevocable form, rather than irrevocable form, so that your children or heirs are cared for in the way that you intended prior to your death. So that's definitely food for thought for a lot of our clients out there, whenever they're looking at how they want to set up their estate planning as well as their asset protection. And those can work together inside of a land trust, an llc, an irrevocable living trust that can become irrevocable upon your death, but prior to your death. Very easy to mold and amend and change according to the way circumstances change as your life progresses. So if anybody ever has any questions, feel free to reach out to us. I'm Joe Siegel, real estate asset protection lawyer here in Florida. If you ever have any questions, feel free to drop comments down below, direct messages, email us, call us or text message. All the information is down in the show notes below. Feel free to reach out. Till then, see you. Thanks for listening to this edition of Trust this. If you got something out of it, please press like and subscribe and give us a five star review to help us reach others who can benefit from this series. Until next time, keep aspiring to a better life.
