How to Transfer Property to a Living Trust
To transfer titled property into your living trust, you must change ownership to the trust. This can be as simple as changing the name on the title document — from your name as an individual, to your name “as trustee” of the trust.
Consider the following titled property:
- Real Estate: requires preparation and filing of a real estate deed.
- All Vehicles (cars, trucks, motorcycles, and boats): Complete a change of ownership document to have the title reissued in the trustee’s name as trustee of the trust (from John Doe to John Doe, as trustee of the John Doe Revocable Living Trust. Check your vehicle title for instructions. If you have questions, contact the agency that issued the title or check its website.
- Bank Accounts / Safe Deposit Boxes: You can change ownership of the bank account to your name as trustee, or you can open a new account and move your money into it. Your local bank branch has the appropriate paperwork. As to safe deposit boxes, you will need to change its ownership.
- Brokerage Accounts: Like bank accounts, you can change ownership of the brokerage account to your name as trustee, or open a new account with you as trustee. Contact your brokerage service for forms and procedures.
- Copyrights and Patents: For copyrights, contact the US Copyright Office for the appropriate transfer document. Transfer all rights in the copyright to yourself as trustee of the living trust. For patents, you can get an assignment form from the Patent and Trademark Office website: www.uspto.gov Transfer to yourself as trustee of the living trust. Ex: From: John Doe >>> To: John Doe, trustee of the John Doe Living Trust.
- Life Insurance Policies:, Individual Retirement Accounts (IRA) and Keogh Accounts: Simply name the living trust as the beneficiary (do not change the name of the account). You remain the owner during your lifetime, and upon your death the proceeds pass to the living trust.
- Mutual Funds: Again, change ownership of the mutual fund account. Contact the mutual fund company for the appropriate forms.
- Stock Certificates and Bonds: Though rare, you may have physical stock certificates or bonds in your possession. If so, you must get new certificates issued demonstrating they are held in trust. Contact the broker or corporation for more information.
- Treasury bills, U.S. bonds and other government issued securities: contact the issuing authority (the government agency) or have your broker contact them for you.
- Business Interests (sole proprietorships, partnerships, limited partnerships, fully (100%) owned corporations, S Corps and other closely held corporations, and limited liability companies):
- Sole Proprietorships: A sole proprietorship has multiple distinct properties and interests, all of which must be listed separately. There should be separate listings for the business name (transfers the name and customer goodwill associated therewith), the business assets (transfer the same way as personal assets. Untitled property via the assignment sheet and titled property by changing ownership to you as trustee of the living trust), and registered trademarks and service marks (change registration to you as trustee).
- Partnerships: Partnership interests require modification of the partnership agreement to specify your interest as being held in trust. Note: Review the partnership agreement for specific requirements or prohibitions on transfer of ownership to a trust.
- Limited Partnerships: Contact the general partner of the limited partnership for forms and procedures, as limited partnerships are governed by securities statutes.
- Fully (100%) Owned Corporations: If you own all (100%) of the outstanding stock in a corporation, follow these steps to transfer the stock to your living trust: 1) complete the transfer section on the back of each certificate; 2) mark the certificate “Cancelled.” Keep the cancelled certificates in the corporate records book; 3) issue new certificates in your name as trustee of the living trust to replace the cancelled certificates; and 4) make written notations of the cancelled certificates and issue of new certificates in your name as trustee in the corporate stock ledger.
- S Corps and other closely held corporations: S Corp stocks can only be held in trust if the trust is a qualified trust under IRS rules. We suggest you consult a tax professional to determine eligibility. For other closely held corporations, reissuing the stock to you as trustee or in the name of the trust is usually all that is required. However, review the corporate bylaws, articles of incorporation and any shareholder agreements for restrictions or prohibitions. You must change any restrictions or prohibitions before the shares can be transferred to your trust.
- Limited Liability Companies : Consult the operating agreement to determine requirements. It is not unusual for the consent of a majority of members to be required. In any event, consent of all members is always preferable.