Key Provisions in a Living Trust 

 Posted on December 30, 2024 in Estate Planning

An Illinois Living Trust, as its name implies, is a trust that you create during your lifetime. Your beneficiaries benefit from the trust after your death. A revocable living trust can also protect you should you become mentally incapacitated. 

There are many benefits to the versatile living trust: It can help avoid probate, you have full control over trust assets during your lifetime, it can be modified during your lifetime, and it is a private document that is not part of the public record. To ensure that your living trust legally fulfills your wishes and contains key living trust provisions, consult with an experienced Yorkville, IL estate planning attorney. 

Beneficiaries, Settlor, and Trustee 

The living trust should list who will be the beneficiaries, settlor, and trustee of the trust. This section is necessary to fulfill the basic purpose of the trust and plan for its administration. 

• Beneficiaries: The individuals or organizations who will receive the trust benefits as an inheritance after your death.

• Settlor: The settlor creates the trust while remaining in control of the assets during their lifetime. This will typically be you, the person setting up the trust. 

• Trustee: The person or entity who will manage the trust’s assets. For a living trust, this will typically also be you.

Revocation and Amendment 

A key benefit of the living trust is your ability to revoke or amend it. Including this section ensures that you retain the flexibility to do that. 

Successor Trustee 

It is always a good idea to include a provision naming an alternate or successor trustee to ensure a smooth transition in the administration of the trust should the named trustee not be able or willing to serve. 

Disability Clause 

To take advantage of another living trust benefit, include a disability clause that lays out what happens if you become disabled or incapacitated. You can include provisions about how incapacitated you must be and give details about how that incapacitation must be proved before your successor trustee takes over. You can also specify what should happen if you regain the capacity to manage the trust. 

Spendthrift Clause

The spendthrift clause protects the trust assets from the beneficiaries’ creditors. In so doing, it fulfills the essential purpose of safeguarding the beneficiaries’ inheritance. 

No Contest Clause 

Put in place to discourage challenges to the trust, this section states that a beneficiary that challenges a trust stands to lose their inheritance under the trust. 

Trust Termination 

To tie up any loose ends, you should include a termination clause detailing the circumstances that will terminate the trust, such as if and when the trust assets are depleted.

Contact a Yorkville, IL Estates and Trusts Attorney

At Gateville Law Firm, we assist clients with wealth creation and preservation. Formulating your estate plan is a crucial step in that process. Our trained Kendall County, IL living trust attorneys are here to advise you on your estate plan and help you set up your living trust. Call us at 630-780-1034 for a complimentary consultation today.