%20(Email%20Header)-.png)
%20(Email%20Header)-.png)
%20(Email%20Header)-.png)
Living Trusts in Ohio
Living Trusts Introduction
Living trusts are a common estate planning tool in Ohio, but they are often misunderstood. Some people believe a living trust is only for wealthy families. Others assume that creating a living trust automatically avoids all legal issues or replaces the need for a will. Neither assumption is accurate.
A living trust is a legal structure that can be useful in the right circumstances, but it is not a universal solution. Understanding how living trusts work under Ohio law, what they are designed to do, and what they do not do is essential before deciding whether one belongs in an estate plan.
What a Living Trust Is
A living trust is a trust that is created during a person’s lifetime. The person who creates the trust is called the grantor. In most living trusts, the grantor also serves as the initial trustee and primary beneficiary while they are alive.
Assets placed into the trust are legally owned by the trust, not by the individual. The trust document controls how those assets are managed during the grantor’s lifetime and how they are distributed after death.
A living trust does not exist automatically once it is signed. It must be properly funded by transferring assets into the trust for it to function as intended.
How Living Trusts Work in Ohio
Living trusts in Ohio operate according to the terms written in the trust document. Those terms define who controls the trust, how decisions are made, and when assets are distributed.
While the grantor is alive and serving as trustee, a living trust often functions much like individual ownership. The key difference is what happens when the grantor becomes incapacitated or dies. At that point, a successor trustee steps in to manage or distribute the assets according to the trust’s instructions.
Because assets held in a properly funded living trust are not owned individually at death, they may avoid the traditional probate process.
Revocable Versus Irrevocable Living Trusts
Most living trusts used in estate planning are revocable. A revocable living trust allows the grantor to amend, revoke, or restate the trust at any time during their lifetime, as long as they have capacity.
Irrevocable living trusts are less common and involve giving up some degree of control. Once created, they generally cannot be changed easily. These trusts are often used for asset protection, tax planning, or benefit eligibility planning rather than basic estate administration.
The distinction matters because revocable and irrevocable trusts have very different legal and practical consequences.
What Living Trusts Do and Do Not Do
Living trusts can provide continuity of management, reduce court involvement, and simplify administration after death when they are properly structured and funded. They are often used to avoid probate, maintain privacy, and allow for smoother transitions if incapacity occurs.
Living trusts do not automatically eliminate taxes, protect assets from creditors, or resolve every estate planning issue. They also do not replace the need for other documents, such as a will, powers of attorney, and beneficiary designations.
A living trust that is poorly drafted or never funded may provide little benefit at all.
Living Trusts and Probate
One of the most common reasons people consider a living trust is probate avoidance. In Ohio, probate is not inherently bad, but it is public, court supervised, and often slower than families expect.
Assets that are properly titled in the name of a living trust generally pass according to the trust terms without going through probate. Assets that are not transferred into the trust may still require probate, even if a trust exists.
For this reason, trust funding is often more important than trust drafting.
When Living Trusts Are Commonly Used
Living trusts are commonly used when someone wants greater control over how assets are managed and distributed, both during life and after death. They are frequently used by individuals with real estate, blended families, concerns about incapacity, or a desire for privacy.
They are also common when estate planning involves coordination across multiple assets or jurisdictions.
In many cases, a living trust is used alongside a will rather than instead of one.
Living Trusts Compared to Wills
A will directs how property is distributed after death and appoints an executor to manage probate. A living trust governs how assets are managed and distributed under its own terms and can operate both during life and after death.
Wills generally require probate. Living trusts may reduce or avoid probate for assets held in the trust.
Most comprehensive estate plans use both tools together, each serving a different purpose.
The Bottom Line
Living trusts are a flexible and powerful planning tool under Ohio law, but they are not necessary for every estate. Whether a living trust makes sense depends on the nature of your assets, your family structure, and your goals.
Understanding how living trusts work, and where they fit within a broader estate plan, is the first step toward deciding whether one is appropriate for your situation.
Related Blog Posts
