If you are confused about what a trust is, you’re not alone. You can’t see it or touch it, yet a trust still exists. In legal terminology a trust is a “legal entity.” It is much like a corporation that you cannot see or touch, but is also a “legal entity”. You can see the people that work for a corporation, the product it produces, the papers it creates, but not the corporation itself.

Trusts have been used for many centuries. They were devised by lawyers as a way of avoiding the property tax laws of the day. In simple terms, a trust is used to hold title to property. For example, you hold title to your car in your name, your house in your’s and your wife’s name (also known as joint tenancy or community property).

When you create a trust, you no longer hold title in your own name. Title is held in the name of the trust. For example, the title of your car changes from Jack Johnson to Jack Johnson trustee under trust dated 2/1/08, or your home from Jack and Mary Johnson as community property to Jack and Mary Johnson,
trustees under trust dated 2/1/08.

You avoid probate by changing the titles to the property you own into the name of the trust. There is no property in your name, therefore there is no probate. You still have complete control of all your property, and can do with it as you please. This boils down to nothing more than a legal technicality that lets your family avoid probate.

You may have heard the term, “Revocable Inter vivos Trust”. “Inter Vivos” means it is created during your lifetime. There is more legal terminology you will need to know.