Trust Funding Generally
The provisions of a trust only apply to assets which are "owned" by the trust. The process to transfer the ownership of assets into a trust is referred to as "funding" a trust. Given the wide variety of assets which may need to be funded into a trust, here is some generally accepted recommendations.
The "EIN" or "TIN" of the Trust
When interacting with financial institutions, you may be requested to provide the "Employer Identification Number" or "Taxpayer Identification Number" of the trust. The EIN or TIN is a 9-digit number an entity can request for the IRS to be independently identified. However, for a revocable living trust, the creator's Social Security Number is used. For a married couple, either number is permitted but it is good practice to be consistent among all assets.
Bank Accounts and After-Tax Brokerage Accounts.
The proper way to transfer a bank account or after-tax brokerage account into a trust is to request the financial institution name the trust as owner of the account. The easiest way to accomplish this is to go into the a local branch with a copy of your trust and fill out any forms they request.
Qualified Retirement Accounts (IRAs, 401(k)s, 403(b)s, etc.)
Federal law prohibits the transfer of ownership of this type of account. As so, the proper way to transfer a qualified account is to name the trust as a beneficiary of the account. If you are married, it is almost always preferred to name your spouse as the primary beneficiary and the trust as the secondary beneficiary; this allows a surviving spouse to "stretch out" the account and continue to enjoy the tax-deferred growth.
The execution of a Quitclaim Deed will transfer title of real estate into one's trust. It should be noted that this act alone does not constitute a taxable event nor is the property reassessed for property tax purposes; it is simply a change in the form of ownership. If the property is jointly owned with one or more other individuals, certain issues need to be considered with relation to these other parties before blindly transferring title.
Life Insurance and Other Death Benefits
Generally, the trust should be named as the primary beneficiary of all life insurance, annuities, and other death benefits. Naming one's spouse as the primary beneficiary for convenience purposes is often considered, but naming the trust (where your spouse is a primary beneficiary) is no less convenient and a number of protections are already in place with the existence of the trust.
Transferring ownership of any business interests is the proper way to ensure the ultimate distribution is handled by the trust. Even if a buy-sell agreement is in place among multiple owners, the proceeds from the buy-out should be paid to the trust. Transferring ownership is usually done with a declaration of intent on behalf of the owner, and updated ownership records and meeting minutes on behalf of the business. When a business is owned by a trust, all of the assets of the business are subject to the trust as well.
Nearly all DMVs in the United States (California included) have their own transfer process in the event of the death of the owner of a motor vehicle. This process bypasses probate and is almost always much more convenient that trying to register a motor vehicle in the name of a trust. As so, motor vehicles can be left owned outside of the trust with little consequences. Owners of collectible or high-value vehicles, however, may want to consider formally transferring ownership and registering the vehicle in the trust.
Safe Deposit Boxes
Safe deposit boxes can (and should) be owned by one's trust. Your branch where the safe deposit box is located should be able to assist you. However, it is important to inquire with your bank what the process is of gaining access to a box owned by the trust if you intend to keep the original trust inside the box.
Art, clothes, jewelry, furniture, family heirlooms, and other items of personal property are transferred into one's trust by way of a document entitled, "Assignment of Personal Property Interest." This is executed as part of the Comprehensive Estate Planning Package and is located behind Tab #9 of your book.
Other Types of Assets
The above assets cover over 95% of the types of assets most clients have. If you have another type of asset not covered above (such as intellectual property or mineral rights), refer to this document for further instruction.