Creating a living trust in Delaware is a strategic move for those looking to manage their assets efficiently and ensure a smooth transition of their estate. A living trust is a legal document that places your assets into a trust for your benefit during your lifetime and specifies how these assets should be distributed upon your death. Unlike a will, a living trust can help you avoid the often lengthy and costly probate process, providing privacy and potentially reducing estate taxes. Delaware, known for its favorable trust laws, offers unique advantages such as strong asset protection and flexibility in trust management. Whether you’re a Delaware resident or considering establishing a trust in the state, understanding the steps involved is crucial.
For more help with your estate planning, consider creating an entire plan with the help of a financial advisor.
Creating a Living Trust in Delaware
Creating a living trust is pretty much the same process no matter what state you live in because it’s a legal document and most states don’t have separate rules. To create a living trust in Delaware, follow these six steps:
- Choose the type of trust: Many people prefer revocable living trusts (as opposed to irrevocable ones) because they can keep control of their estate, remove assets at any time and cancel the entire trust if they want. If you are married, you’ll likely want a joint trust, though if it’s a marriage from later in life and you have separate assets, two single trusts may be more appropriate.
- Identify the assets you want in the trust: Next, you should identify the assets you want to put in the living trust and then gather the relevant documents. These may include bank accounts and certificates of deposit (CDs), titles to your cars and deeds to real property like your home.
- Choose a trustee: The trustee will manage assets in the trust. If you designate yourself as the trustee, you’d need to select a successor to the trustee.
- Create the trust document: You can do this using online software or with the help of an estate planning lawyer.
- Execute the trust documents: Sign the document in front of a notary public.
- Fund your trust by transferring assets to it: You can do this on your own, but the paperwork can be tricky, so you may want help from a lawyer or financial advisor.
What Is a Living Trust?
Like a will, a living trust is a legal document that assigns who should receive property when the owner (or trust grantor) dies. Unlike a will, it’s also an entity that holds the assets while the owner is alive. The primary aim of a living trust is to avoid probate, a court process that can take months and even years if the estate is especially complicated.
The grantor appoints a trustee to manage the assets in the trust. People commonly name themselves as the trustee, but when they do, they also need to name a successor trustee for when they die. If the distribution of your property is not to happen immediately after your death or if the beneficiary is disabled, the trustee will manage the assets for as long as necessary.
You can fund a trust with various types of assets and physical property, including:
- Bank deposit products such as savings accounts, money market or checking accounts
- Investments such as stocks, bonds and mutual funds
- Certificates of deposit (CDs)
- Real estate property
- Life insurance policies
One thing you can’t transfer to a revocable living trust is a traditional individual retirement account (IRA). By law, an IRA must be in the name of a person. You can consult with a lawyer on what happens to any IRA account that you may have.
How Much Does It Cost to Create a Living Trust in Delaware?
The largest expense when creating a living trust is attorney fees. Depending on the lawyer, they can run to $1,000 and beyond. If you want to keep costs down, there are online programs available for less than $100. Keep in mind, though, that you can run into plenty of pitfalls with DIY estate planning.
Beyond legal fees, there are other potential costs to consider when setting up a living trust. These may include fees for transferring assets into the trust, which can involve retitling property deeds or updating beneficiary designations. Additionally, if your estate is particularly complex, you might incur costs for financial advisors or tax professionals to ensure all aspects of your estate are properly managed. It’s important to factor in these additional expenses when budgeting for your living trust.
Given the complexities and potential costs involved, consulting a financial advisor can be a wise step when considering a living trust in Delaware.
Why Get a Living Trust in Delaware?

One of the biggest benefits offered by a living trust is bypassing probate. This is the process by which a court determines how to treat your estate based on its interpretation of your will. Delaware has not enacted a Uniform Probate Code, so the process is considered lengthy. And it can end up being expensive, as lawyer fees add up. That said, the state has a simplified probate process for estates valued below $30,000.
Unlike wills, which become public record once they go through probate, a living trust remains private. This means that the details of your estate and the distribution of your assets are not disclosed to the public. Additionally, a living trust allows you to maintain control over your assets while you are alive. You can make changes to the trust as needed, ensuring that your estate plan reflects your current wishes and circumstances.
A living trust provides flexibility in managing your assets. You can appoint a trustee to manage the trust on your behalf, which can be particularly beneficial if you become incapacitated. This ensures that your financial affairs are handled according to your instructions, without the need for a court-appointed guardian. Furthermore, a living trust can include specific instructions for how your assets should be managed and distributed, allowing you to tailor your estate plan to meet the unique needs of your family.
Delaware is known for its favorable tax laws, and a living trust can help you take advantage of these benefits. While a living trust does not provide direct tax savings, it can be structured in a way that minimizes estate taxes. Additionally, Delaware’s asset protection laws can help safeguard your assets from creditors, providing an extra layer of security for your estate. By working with a knowledgeable financial advisor, you can ensure that your living trust is set up to maximize these benefits.
Who Should Get a Living Trust in Delaware?
Living trusts are not just for the wealthy. You should consider a Delaware living trust if your net worth is more than $30,000, if you own property in other states or if you simply want your estate to avoid the interference of the court.
Additionally, trusts are a good choice for people who want to provide for someone with special needs or who want to delay the distribution of their estate until heirs are, say, 30. (With wills, estates are distributed once probate ends.) A living trust is also recommended if you are disinheriting someone or unequally spreading your wealth. A living trust is harder to contest than a will.
Living Trusts vs. Wills
Wills are always recommended, whether you have a living trust or not. The two combined can ensure that all of your estate is distributed as you wish, since you’ll likely leave something out of your trust. A will also offer some benefits that a living trust won’t. For instance, you can state your preferred guardians for minor children and name an executor through your will. You can also use it to express how you want debt and taxes to be handled.
The table below offers some information about what you can and can’t do with these two estate planning tools.
Living Trusts vs. Wills
Living Trusts | Wills | |
Name guardians for children | Yes | Yes |
Allows revisions to be made | Depends on type | Yes |
Avoids probate court | Yes | No |
Requires a notary | Yes | No |
Name an executor | No | Yes |
Names an executor | No | Yes |
Requires witnesses | No | Yes |
Living Trusts and Taxes in Delaware
The Delaware estate tax was repealed on January 1, 2018, and the state has no inheritance tax either. At the federal level, a living trust may help only very large estates, since the federal estate tax (also called the death tax) has an exemption of $13.99 million for individuals and $27.98 million for married couples.
Bottom Line

A living trust will help your heirs avoid probate in Delaware, which has not adopted the Uniform Probate Code, if you have a large or otherwise complicated estate. If the value of your estate is less than $30,000, however, a living trust is unnecessary, since there is a simplified process for small estates. For more help with your estate planning, consider hiring a qualified financial advisor and discussing all the types of trusts you have access to.
Estate Planning Tips
- A living trust is just one type of estate planning tool. To get comprehensive help with your entire estate, you may want to consider working with a financial advisor. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- You can also check out our vetted list of financial advisors who serve Delaware by seeing which firms we rank at the top.
- Review your estate plan every few years. You should also update it whenever you experience a life-changing event (such as the birth of a child or grandchild) or when Congress makes any changes to estate tax law. This will ensure that your plan reflects your wishes and goals.
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