If it is like the trust that my parents used or the one I have that would be true if the children leave the land in the trust OR the value of the trust is under the limitation and the land is distributed to the individuals. I will not guarantee my statement is correct because it has been a number of years since any of this was set up so it is not fresh in my mind. But I remember at the time of my mothers death dad didn't figure he would need her half of the trust to live on so he went ahead and let it be distributed instead of keeping it under the trust and his control. He died a couple of years later and the amount left in the trust (his portion) was under the limit so we (the 5 kids) distributed the rest of it. It is my understanding that if needed, we could have left part or all of the land and assets in the trust and let it continue to exist as a separate entity to avoid the inheritance tax on any excess above the exemption limit. Since that provision was not needed, we kids just distributed the assets of the trust and liquidated it.

That is my foggy remembrance of the living trust my parents set up and when they did it, it looked like such a good idea that I think all my brothers and sisters as well as myself set up the same type of trust with the same attorney.

I know it worked extremely well. No probate to drag out. At time of death attorney came once and we all sat around the kitchen table and he laid out the options for the trust, we all decided what to do, and a few weeks later he came back with all the paperwork to sign, then he recorded it. Done deal. Same when second parent died.

Be wary of some attorneys. If they like billable hours they go out of their way to make things a lot more complicated and convoluted than they need be. Get one that specializes in estates and talk to references to see how it has worked out. Not all attorneys are created equal or have the same ethical standards (kind of any other walk of life). We got lucky and got a good one and the process could not have been any easier.

John