There is a plethora of estate planning options for Detroit residents who want to avoid probate litigation and reduce personal liability. Neither lawsuits over personal property nor family strife pertaining to the distribution of assets are desirable consequences of estate planning. In particular, Michigan real estate owners may want to consider a few important tools for avoiding future problems with probate.
One effective method of passing on real estate is to create a revocable trust. Such a trust is especially important because it allows you to address any potential changes in circumstances. Revocable trusts award complete control of property to the estate planner, even after the trust has been created. That means the architect of the trust does not need the permission of trust beneficiaries to change key terms during the estate planner's lifetime.
For instance, a spouse may create a trust and name the other spouse as the beneficiary, and a revocable trust allows the estate planner to change those terms should his or her spouse die.
Setting up a limited liability company -- or LLC -- is another helpful option if any of your property generates income. An LLC reduces personal liability by making the company, and not the owner's personal assets, the subject any lawsuit claims.
An AB living trust is also a very useful tool. This type of trust can provide for a smooth transition for bequeathing property from a surviving spouse to the couple's heirs. Living trusts also make it easier to set up a distribution plan for a spouse to ensure that all of his or her future financial needs are met.
Source: Reuters, "Weighing the what-ifs of trusts and LLCs," Beth Pinsker Gladstone, May 3, 2012