Friday, September 6, 2013

Trust Funding – What To Do With Your Vehicle?

We always encourage our clients to properly fund their trust.  Ideally a person’s trust should become the new owner on real estate, bank accounts, life insurance, non-qualified retirement investment accounts, and even cars.

Naturally, plenty of clients balk at our instruction to transfer title ownership of their cars to the trust.  After all, in Nevada this can require making a change to your liability insurance policy so that the registration and insurance can be verified to match by the DMV.  And why go to all the effort when you are just going to upgrade the car next year?
While transferring title of a vehicle to a revocable trust is the best advice for dealing with contingencies, we do often recommend the following alternative:  the use of Nevada Department of Motor Vehicles Form VP239 – titled Transfer on Death Application.  The form can be found here.  This form allows current title holders to add one transfer-on-death beneficiary to the title.  The vehicle cannot have a lienholder, but the form is useful for permitting a hassle-free transfer of ownership of a vehicle upon a person’s death.   So, if the vehicle is paid for and if you are satisfied with the vehicle transferring directly to just one beneficiary, then this method is potentially much easier than transferring title to the trust.
For those interested in doing it the official way, the form for transferring title of a vehicle to a trust is Form VP188 and can be found here.  Make sure to read the information on the DMV website here under “Family Trust” for instructions on how to properly accomplish the transfer.

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