General Assignment of Assets

General assignment of assets to a trust is a legal process in which an individual transfers ownership of their property to a trust they have established. Facilitated by the use of the general assignment of assets document, this is a fundamental step in creating and funding a trust so the assets can pass according to the terms and instructions outlined in the trust document.

How do you transfer assets into a trust?

Completing a transfer of assets into a trust starts with drafting a formal trust document. This document outlines the terms, conditions, beneficiaries, trustee(s), and instructions for how the assets should be managed and distributed. 

To properly execute an assignment of personal property to a trust, you start by listing all of the assets you’d like to transfer. You can use estate planning software to ensure every asset is accounted for and nothing is missed when creating the list of assets to be transferred. After listing all assets to be transferred, the document is signed by the settlor to make the transfer official.

What kinds of property can a general assignment of assets be used for?

A general assignment of assets can be used for both personal property and real property. Personal property can be both intangible such as stocks or tangible like furniture, jewelry, or boats. Real property can include land, houses, apartments, or other buildings or real property.

A best practice when completing an assignment of personal property into a trust is to be as specific as possible, especially when it comes to unique or highly valuable property such as collectibles or jewelry. 

What are the benefits of using a general assignment of assets document?

Before putting assets into a trust, they are typically held in an individual’s name. Upon an individual’s death, the assets pass by will or beneficiary designations. When you create a trust, however, the trust becomes a container to hold the assets that you’d like to distribute in a specific manner. 

Without moving assets into the trust, the trust is simply an empty container because only the assets inside the trust are subject to the terms of the trust agreement. That’s why it’s important to use a general assignment of assets document to ensure that the transfer of assets into the trust is official so there’s no confusion or conflict upon the settlor’s death. In case an individual fails to officially transfer assets into a trust before death, the general assignment of assets document serves as proof that those assets were designated as trust assets.

What else is important to know about the general assignment of assets document?

While the general assignment of assets document is one of many important estate planning documents that individuals should complete when they utilize a trust, it’s important to note that there may be other steps needed to ensure the assets are held in the trust. The following should be kept in mind for transferring certain kinds of property into a trust:

• Real Estate – Prepare and execute a deed transferring property ownership to the trust and ensure that the trust is listed as the owner on property records.
• Bank Accounts and Investments – Change the ownership and beneficiary designations of bank accounts, investment accounts, retirement accounts, life insurance policies, and annuities to ensure they align with your trust’s provisions.
• Personal Property – Be as specific as possible, being sure to describe the personal property in detail to ensure there’s no confusion or conflict upon the owner’s death. 
• Business Interests – If you own a business, you may assign your business interests to the trust through appropriate legal documentation, such as a buy-sell agreement or assignment of membership interests.

It’s also important that settlors inform relevant parties about the existence of the trust and the assets assigned to it. This may include notifying financial institutions, insurance companies, and key family members or beneficiaries.