Why Set Up a Trust in Florida?
Setting up a trust is one of the most effective ways to avoid probate in Florida, protect your assets, and ensure your family receives their inheritance without court delays. Whether you are planning for retirement, protecting minor children, or managing multi-state property, a trust gives you control over how and when your assets are distributed.
At Barnes Walker, our estate planning attorneys have helped thousands of Florida families set up trusts since 1995. This guide walks you through the process step by step.
Step 1: Determine Your Goals
Before choosing a trust type, clarify what you want to accomplish:
- Avoid probate: A revocable living trust is the most common tool for this purpose
- Protect assets from creditors: An irrevocable trust provides creditor protection
- Plan for incapacity: A revocable trust with a successor trustee avoids the need for court-appointed guardianship
- Provide for a disabled beneficiary: A special needs trust preserves government benefits eligibility
- Protect a beneficiary from themselves: A spendthrift trust restricts access and protects from creditors
- Reduce estate taxes: An irrevocable trust removes assets from your taxable estate
- Plan for Medicaid: A Medicaid asset protection trust (irrevocable) can shield assets from long-term care costs
Step 2: Choose the Right Trust Type
Florida recognizes many trust types, but the two primary categories are:
Revocable Living Trust
The most popular option. You maintain full control, can amend or revoke at any time, and your successor trustee manages assets after your death without probate. Best for: most families, homeowners, retirees, and anyone who wants probate avoidance with flexibility.
Irrevocable Trust
Assets are permanently removed from your estate. You give up control in exchange for asset protection, tax savings, and Medicaid planning. Best for: high-net-worth individuals, those planning for long-term care, and families needing creditor protection.
Read our detailed comparison: What's the Difference Between a Will and a Trust?
Step 3: Choose Your Trustee and Successor Trustee
The trustee manages the trust assets. For a revocable living trust, you typically serve as your own trustee during your lifetime. You also name a successor trustee who takes over when you pass away or become incapacitated.
Common successor trustee options:
- A spouse or adult child: Cost-free and familiar with the family, but must be willing and capable of handling financial responsibilities
- A trusted friend or family member: Should have strong financial judgment and organizational skills
- A professional or corporate trustee: Banks and trust companies charge annual fees (typically 0.5% to 1.5% of trust assets) but provide professional management and objectivity
- Co-trustees: Two or more individuals serving together, which provides checks and balances but requires agreement on decisions
Learn more about trustee duties: What Is a Trustee and What Are Their Duties?
Step 4: Draft the Trust Document
Your attorney will prepare the trust document, which includes:
- Identification of the grantor (you), trustee, and successor trustee
- A detailed list of beneficiaries and their respective shares
- Distribution instructions (outright, staged, or conditional)
- Powers granted to the trustee (investment, sale, distribution authority)
- Spendthrift provisions to protect beneficiaries from creditors
- Incapacity provisions (how incapacity is determined, trustee succession)
- Tax planning provisions
- Governing law (Florida Trust Code, Chapter 736)
A complete trust package from Barnes Walker typically also includes a pour-over will, durable power of attorney, healthcare surrogate designation, and living will.
Step 5: Fund the Trust
This is the most critical step. A trust only controls assets that are titled in the trust's name. An unfunded trust provides zero probate protection.
Real Property
Your attorney prepares a new deed transferring your home, rental property, or land from your individual name to the trust. The deed is recorded with the county clerk. Florida homestead exemption is preserved when the trust is properly structured.
Bank and Investment Accounts
Contact each financial institution and request that the account be re-titled in the name of the trust. You will need a certificate of trust (a summary document your attorney provides) to verify the trust's existence without sharing the full document.
Business Interests
LLC membership interests, partnership interests, and corporate stock can be transferred via assignment documents. Your operating agreement or bylaws may need to be amended.
Assets NOT to Transfer
Retirement accounts (IRAs, 401(k)s) should not be transferred into a trust, as doing so triggers immediate taxation. Instead, name the trust or individuals as beneficiaries. Life insurance policies should similarly use beneficiary designations.
Step 6: Maintain and Update Your Trust
A trust is not a one-time document. You should review and update it when:
- You buy or sell property
- You get married, divorced, or remarried
- A child or grandchild is born
- A beneficiary or trustee passes away
- Tax laws change significantly
- You move to Florida from another state
- Your financial situation changes substantially
Our trust administration attorneys help clients review and update their trusts as their lives evolve.
Frequently Asked Questions
How do I set up a trust in Florida?
Setting up a trust involves five steps: determine your goals and choose the right trust type, choose your trustee and successor trustee, work with an attorney to draft the trust document, fund the trust by transferring assets, and notify financial institutions. An estate planning attorney ensures the trust is properly structured and funded.
How much does it cost to set up a trust in Florida?
A revocable living trust package typically costs $1,500 to $3,500 when prepared by an attorney, including supporting documents. Irrevocable trusts and complex estate plans may cost $3,000 to $7,500 or more depending on the complexity of the estate.
Do I need a lawyer to set up a trust in Florida?
While not legally required, using an attorney is strongly recommended. Trust documents must comply with the Florida Trust Code, and improperly drafted or funded trusts can fail to avoid probate, create tax problems, or result in unintended distributions.
What is the difference between a family trust and a living trust?
A family trust and a living trust are often the same thing. A living trust is created during your lifetime (as opposed to a testamentary trust created by a will). A family trust is simply a living trust designed to benefit family members. Both terms typically refer to a revocable living trust.
Ready to set up a trust for your family? Contact Barnes Walker for a consultation with one of our estate planning attorneys.