How do I transfer individual stocks to my trust?

It is not often that clients own stocks held in their individual names. Usually these stocks will be held through one or more brokerage or investment accounts owned by the individual. Transferring stocks held in one's name to a revocable living trust requires dealing with the so-called "transfer agent," which is a time-consuming process and entails additional documents such as an Affidavit of Domicile and Medallion Signature Guarantee. 

Because of the additional steps required to transfer shares of stock held individually, it is well worth it to consider consolidating these individual stocks into a brokerage account. By doing so, one is able to deal directly with a financial institution, which is generally more responsive than a stock transfer agent. Moreover, holding the stocks through a brokerage account eliminates the risk of losing stock certificates.

The financial institution holding the stock certificates also makes it much easier for you to transfer the stock in the future, should you choose to do so.

How do I transfer my home to my trust?

For most families, their primary residence is the most valuable asset they own. As such, transfers of said property to the client's trust is a crucial and central part of the estate planning process. 

The process of transferring real property to a trust is not complicated. It basically entails the recording of a deed in the Recorder's Office of the county where the property is located. The deed contains critical information such as the identity(ies) of the transferring party and the receiving party, as well as the legal description of the property to be transferred.

Unfortunately most individuals who try to "DIY" (do-it-yourself) their estate plan fail to take the proper actions to transfer their home to their living trust. As a result, after the individual's death and unbeknownst to him or her, the beneficiaries discover that the individual was under the mistaken belief that simply creating a trust was adequate to avoid probate (usually a primary motivation for creating a living trust).

If you own real property and also have a trust, it's not a bad idea to check the title to your home and ensure that it is in the name of your trust. A real estate professional or your estate planning lawyer should be able to do this for you.

Can I transfer my professional practice to my trust?

Under the California Corporations Code Section 13407, only a qualified professional may be a shareholder in a professional corporation such as a law, medical or accounting practice. Generally speaking, shares in a professional corporation may be transferred to a revocable trust under the following conditions (See Cal Dep't of Consumer Affairs Legal Opinion 79-5):

  1. The Trustee and current beneficiaries of the trust are licensed professionals in the relevant field.
  2. A non-licensed spouse of a licensed spouse-Trustee does not have an interest in the trust greater than his or her community property interest in the shares of the professional corporation;
  3. The trust must provide that: (a) the licensed spouse-trustee has exclusive control and powers relating to the shares of the professional corporation, and (b) on the nonlicensed spouse's death, the spouses' children (or other beneficiaries) have a beneficial interest, if at all, only in the proceeds that may be received from the shares and not equitable title to those shares.
How do I transfer my interest in an LLC or a partnership to my trust?

The ability to transfer one's interest in an LLC or partnership is generally governed by an operating or partnership agreement. Usually these agreement contain restrictions on the transfer or sale of an interest in the LLC or partnership; however, many agreements provide an exception where the transfer is to a family member or to a revocable living trust.

If the agreement provides for specific instructions on how to do this, the estate planning lawyer should follow them. Generally, the transfer requires no more than a simple Assignment document wherein the owner of the LLC or partnership states his or her intention to transfer the interest to his or her own revocable living trust.