A declaration of trust (also known as a “living trust” or “revocable living trust”) is an agreement you make with yourself. You can amend or revoke your living trust any time while you are competent. It is a “see-though” document (an “ignored entity” and not considered as separate from you) for income tax purposes and does not require admin- istration by a professional trustee, a taxpayer identification number or other trust formalities during your lifetime.
Basically, you can do what you like with your property in your own living trust and you owe no “fiduciary duties” to yourself or to your future beneficiaries. There are typically no ongoing fees or maintenance costs while you or a loved one acts as trustee. An individual who creates a living trust is typically the grantor, trustee and sole beneficiary of the trust while alive. Living trusts typically do not protect the trust assets from creditors of the grantor but can be designed to protect assets which pass to descendants. One goal of a living trust (as opposed to an estate plan which disposes assets at death solely under a will) is to empower the next-named (i.e., successor) trustee to deal with assets for the benefit of the grantor during his or her life and for the beneficiaries after death of the grantor without the need for the power, authority, costs and risks of Probate Court involvement. Living trusts provide for tax planning, clarity and minimize family disputes.