How to Create an Alaska Living Trust
Alaska is one of the few states that has signed the uniform probate code into law. This means your assets will not have to go through the probate process if you choose to use a will to pass them on. However, you may also need a living trust, and this article will show you some of the reasons why.
Living Trusts in Alaska
It is a big myth that only senior citizens need a living trust. More and more young people are realizing that they can plan for their future long before they retire, die, or become incapacitated by taking advantage of the benefits of a living trust.
Only about 11% of Alaska's population comprises senior citizens, making it one state with the highest population of young persons. Young people who decide to begin succession planning can take advantage of specific types of living trusts, such as a revocable trust.
Types of Living Trusts
There are two types of living trust: revocable living trust and irrevocable living trust. The primary difference is the flexibility one (revocable trust) offers over the other (irrevocable trust). Other major differences are:
- The trust tax burden, which typically is associated with a revocable trust.
- Power of termination, which is given to the grantor of a revocable trust, but is shared between the beneficiary and the grantor within an irrevocable trust.
- Ownership of property, which is ceded to the trust with an irrevocable trust, but still belongs to the grantor in a revocable trust.
- Property protection, which can be made possible under an irrevocable trust.
Trust vs Wills in Alaska
Wills are another popular estate planning tool in Alaska. Thanks to its overly simplistic process and the ability to avoid the cumbersome probate process, many Alaska citizens opt for wills instead of trusts. However, a will ought not to be used as a substitute for a living trust. Both have their unique benefits that, when combined, can provide a comprehensive, satisfactory estate cover for you.
Here's how a will and a living trust compare in Alaska:
|Holographic wills, testamentary wills, pour-over wills, and oral wills are all different types of wills.||Revocable trusts, irrevocable trusts, testamentary trusts and joint trusts are all types of living trusts.|
|Provides no rules for inheritance.||Provides elaborate rules for inheritance.|
|Is not active until the death of the owner.||Becomes active upon completion and signing.|
|Guarantees no privacy of records.||Ensures privacy of records.|
|Is prone to litigation and court challenges.||Is less likely to be challenged in court.|
Why Do You Need a Living Trust in Alaska?
Apart from the reasons highlighted above, here are some specific points to note when wondering what are the advantages of getting a living trust:
Leave specific instructions for minor beneficiary
Most young married people who set up a living trust will probably have minors as beneficiaries. A living trust can help you set specific instructions on how you'll want your assets handled and who would help you take care of them till your minor beneficiaries are of age.
Avoid estate taxes
With a living trust, specifically irrevocable living trusts, you can avoid estate taxes, especially for estates with a value above $12 million. A joint living trust for you and your spouse can also do the trick for you.
Protect assets from nursing homes
It may be uncertain if you need the services of nursing homes, but you can always be safe by opening a living trust. This puts your valued assets into a trust away from the hands of nursing homes.
Add additional assets
A revocable living trust will enable you to add new assets as you gain them into the trust. You can also remove any asset to which you no longer feel comfortable leaving in your trust.
Setting Up Your Living Trust in Alaska
To set up your living trust in Alaska, you need to:
- Choose an individual or an institution as a trustee.
- Make a list of your beneficiaries and decide their benefits.
- Draft additional instructions for trustees.
- Define assets to be included in trust.
- Fill all information into a living trust form.
- Visit a state court to notarize your living trust form.
- Effect all asset title change and transfer to trust.
- Safe-keep your completed trust document.
- Create a Revocable Living Trust With DoNotPay
- Sign-in to DoNotPay and search for the Revocable Living Trust product
- Enter the names of the trustees you are assigning
- Enter the names of the beneficiaries of the trust
- Select assets to add to the trust
After that, DoNotPay will generate a living trust tailored to the state of Alaska. You can get your document notarized through DoNotPay as well - just use the “Notarize Any Document” service and we’ll redirect you to a notary service.
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