Quick Take

Maintain Privacy
Loss of Privacy With Will

A Will must be probated and therefore becomes a part of the public record, but a trust agreement is not probated. For instance, Michael Jackson’s Last Will and Testament is all over the web and in magazines. Everybody knows its content.

Because a revocable trust is not disclosed in the public record, both the terms of the trust and the assets that were transferred to the trust during the lifetime of the grantor can remain private.[2]


It is very important to coordinate who is going to pay the taxes. When there is a revocable trust, there is always a pour-over will. Usually, the executor is primarily liable for the payment of estate administration and taxes. Because most of the assets should be in the trust,
it is important to give instructions for the trustee to pay the taxes and maybe the estate administration expenses; if not, the estate could be insolvent. 

Finally, the tax clause should be carefully drafted,  particularly when a good portion of the assets transferred will be non-probate. 

A tax apportionment clause should be considered in such a situation.

Fully Funded Trust Avoids Probate

The reasons to use this ‘horsepower’ of a fully funded trust (in which assets are re-titled in the name of the trust at formation) are well beyond tax planning. Estate tax avoidance can be accomplished with testamentary trusts in a living trust-based plans. Advanced tax planning and asset protection in a litigious American society involves the use of various forms of irrevocable trusts. Dynasty trusts are a type of trust that offer significant tax-advantages and intergenerational wealth transfer opportunities as well as asset protection.