If you have set up a trust, you must transfer your property to the trust to enjoy one of the benefits of setting up the trust. Thus, how you transfer tangible personal property to a revocable trust is an important question. After the death of the creator of a trust (identified after death as the "decedent"), if tangible personal property has been transferred to a revocable trust, then the successor trustee of the trust will control the tangible personal property. However, if the tangible personal property has not been transferred to a trust, then upon the decedent's death, the disposition of the tangible personal property will be governed by the decedent's will. The will and the trust may not transfer the tangible personal property to the same individuals, and this can be a hotly contested issue if the value of the tangible personal property is significant. Thus, the best way to ensure that the decedent's intent to vest the ownership of the tangible personal property to the trust is clear is to execute a bill of sale transferring the property to the trust. The bill of sale should identify the tangible personal property transferred to the trust with sufficient detail so that there are no problems understanding what property is transferred to a trust and what property is not transferred to the trust. It is also a good idea for the trustee to confirm receipt of the tangible personal property.
Without a bill of sale, it will be very difficult to prove that the decedent intended to transfer his or her tangible personal property to the trust. For additional information, contact Cody & Linde, PLLC today!