You've done the right thing — you set up a revocable living trust. But creating the trust document is only half the job. The real work is funding it: actually transferring ownership of your assets into the trust so they can do what a trust is designed to do — pass to your heirs quickly, privately, and without going through probate court.

Here's the thing most people don't realize: a trust that holds no assets is worthless. It's just paper. And many people make the mistake of paying an attorney to draft a trust, signing it, and then never moving a single asset into it. Their estate ends up in probate anyway, just as if the trust never existed.

This guide walks you through exactly which assets belong in your trust, how to transfer each one, why it matters — and equally important, which assets you should leave out of the trust entirely, because putting them in can actually cost your family money.

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Put These IN the Trust
✓Primary home & real estate
✓Vacation / rental properties
✓Bank & savings accounts
✓Non-retirement brokerage accounts
✓Business interests (LLC, S-Corp)
✓Valuable personal property
✓Notes receivable & loans owed to you
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Leave These OUT
✗IRAs (Traditional, Roth, SEP, SIMPLE)
✗401(k), 403(b), 457 plans
✗Life insurance (use trust as beneficiary instead)
✗Vehicles (usually — see note)
✗Health Savings Accounts (HSA)
✗529 college savings plans

Assets That Belong in Your Trust

These are the assets where trust ownership delivers clear, meaningful benefits — primarily avoiding probate, maintaining privacy, and ensuring a smooth transfer to your heirs without court involvement.

1
🏠 Your Primary Home
Your home is almost certainly your largest asset — and it's also one of the most probate-prone. Real estate owned in your individual name must go through probate when you die before it can transfer to your heirs. Probate for real estate can take 12–18 months and cost thousands in court and attorney fees. Holding it in a trust eliminates all of that. Your heirs can receive the property in weeks rather than over a year, without a judge involved and without the transaction becoming public record.
How to Transfer
Execute a new deed transferring title from you personally to you as trustee — for example, from "John Smith" to "John Smith, Trustee of the John Smith Living Trust, dated [date]." This deed must be signed, notarized, and recorded with your county recorder's office or register of deeds. Your estate planning attorney can prepare this deed, or a real estate attorney can handle the recording. There is typically a small county recording fee but no tax consequence for this transfer since you remain the beneficial owner.
2
🏡 Vacation Homes & Rental Properties
Every piece of real estate you own in multiple states is a separate probate proceeding in each state where the property is located. Without a trust, your family could face simultaneous probate proceedings in two, three, or more states. Transferring all real estate into a single trust eliminates every one of those separate proceedings. This is one of the most compelling reasons for real estate investors and vacation home owners to have a trust — the savings in time and money can be enormous.
How to Transfer
Same process as your primary residence — a new deed for each property, recorded in the county where that property is located. If you have an LLC that holds rental properties, you may instead transfer your LLC membership interest into the trust rather than deeding each property separately. Consult your attorney on the most efficient structure for multiple properties.
3
🏦 Bank Accounts & Savings Accounts
Checking accounts, savings accounts, money market accounts, and CDs held in your individual name are probate assets. Your family may be unable to access these accounts for months while the estate is in probate — even for urgent expenses. Transferring them into the trust (or designating the trust as a POD — Payable on Death — beneficiary) ensures immediate access after your death.
How to Transfer
Contact your bank and ask to retitle the account to your trust. Bring your trust certificate (a shortened summary document your attorney prepares) or the full trust document. Most banks handle this routinely. Alternatively, you can add the trust as the POD beneficiary on each account, which accomplishes a similar result with less paperwork — though full retitling is the more complete solution.
4
📈 Non-Retirement Brokerage Accounts
Taxable investment accounts — brokerage accounts at Vanguard, Fidelity, Schwab, or other brokerages — are excellent candidates for your trust. These accounts don't have the tax-protected status of IRAs or 401(k)s, so there's no tax disadvantage to holding them in the trust. They can be substantial assets, and without a trust designation, they pass through probate. See the important note below about the step-up in basis, however — it actually makes this the right call.
How to Transfer
Contact your brokerage and ask to retitle the account to the trust. Most major brokerages (Vanguard, Fidelity, Schwab, Merrill, etc.) handle trust account registrations routinely. You'll typically provide a trust certification document and complete a new account registration form. The investments themselves don't change — only the account ownership name. There are no tax consequences to this retitling.
5
🏢 Business Interests
If you own an LLC, S-corporation interest, partnership interest, or sole proprietorship, these business interests are significant assets that are fully subject to probate if held in your own name. Transferring your ownership interest into your trust ensures continuity of the business during estate administration and avoids a court-supervised transfer process that can disrupt business operations at the worst possible time.
How to Transfer
For an LLC: amend the operating agreement and membership records to reflect the trust as the member. For an S-corporation: check carefully first — trusts can hold S-corp stock, but only certain types of trusts qualify (including revocable living trusts). Confirm with your attorney before transferring. For sole proprietorships: the business assets are personal property and transfer with the trust funding process. Always review any partnership or shareholder agreements for transfer restrictions.
6
💎 Valuable Personal Property
Artwork, jewelry, collectibles, antiques, and other high-value personal items can be transferred into a trust via a written assignment of ownership. While everyday household items aren't worth the administrative effort, valuable items that could cause family disputes or require appraisal for tax purposes benefit from explicit trust ownership and clear directives about who receives them.
How to Transfer
Create a written "Assignment of Personal Property" document signed by you, specifically listing the items (with descriptions and approximate values) being transferred to the trust. This document doesn't need to be recorded publicly — just kept with your trust documents. Update it as you acquire or dispose of valuable items. Some attorneys include a general assignment clause in the trust itself to capture all personal property you intend to include.
Dad's Take

"The mental shift that helped me get this done: stop thinking of it as 'putting assets in a trust' and start thinking of it as updating ownership records. You still own everything. You still control everything. Nothing changes in your daily life. The only difference is that when you're gone, your family bypasses a court process that would have cost them time, money, and stress. That's worth an afternoon of paperwork."

Assets to Leave OUT of Your Trust

This is where most estate planning guides fall short — they tell you what to put in the trust but don't explain why certain assets should stay out. In some cases, putting the wrong asset into a trust can trigger unnecessary taxes, strip away valuable protections, or simply be redundant with a better mechanism already in place.

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🏦 IRAs — Traditional, Roth, SEP, and SIMPLE
Never transfer an IRA into your revocable trust. An IRA is a tax-advantaged account that requires the owner to be an individual — transferring it to a trust is treated by the IRS as a complete distribution, meaning you'd owe income taxes on the entire balance immediately. That could be a five- or six-figure tax bill in a single year. This is one of the most expensive mistakes in estate planning, and it's completely avoidable.
The Right Approach
Instead, name your beneficiaries directly on the IRA beneficiary designation form. A surviving spouse can roll the IRA into their own IRA and continue tax-deferred growth. Non-spouse beneficiaries inherit the IRA and must generally draw it down within 10 years under the SECURE Act. If you want the trust to ultimately receive the IRA funds — perhaps for a minor child or a spendthrift beneficiary — a specially drafted "see-through trust" can be named as beneficiary, but this requires careful planning with your estate attorney.
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💼 401(k), 403(b), 457, and Other Employer Plans
The same logic applies to all employer-sponsored retirement plans. These accounts have their own built-in beneficiary designation system that operates completely outside of probate — they're already designed to pass directly to named beneficiaries without court involvement. There is no reason to involve a trust, and attempting to do so could trigger mandatory distributions and significant tax consequences.
The Right Approach
Log into your 401(k) plan and confirm your primary and contingent beneficiary designations are current. This is the correct and complete solution for these accounts. Review them after every major life event: marriage, divorce, birth of a child, or death of a named beneficiary.
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📈 Taxable Brokerage Accounts — The Step-Up in Basis Exception
Wait — didn't we just say to put brokerage accounts in the trust? Yes, and that's still generally the right call for avoiding probate. But there's an important tax concept to understand here: the step-up in cost basis. When you die and your heirs inherit a taxable brokerage account, the cost basis of every investment "steps up" to the fair market value at the date of death — wiping out all of the embedded capital gains that accumulated during your lifetime. This benefit applies whether the account is in a trust or not, because a revocable living trust is a "grantor trust" and treated as if you personally own the assets for tax purposes. Your heirs receive the step-up regardless.
The Good News
Unlike IRAs, revocable trust ownership does NOT eliminate the step-up in basis on brokerage accounts — you get probate avoidance AND the step-up. This makes brokerage accounts one of the best assets to hold in a trust. The distinction worth knowing: an irrevocable trust would forfeit the step-up, which is why you generally keep brokerage assets in a revocable (not irrevocable) trust.
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🚗 Vehicles (Generally)
Technically you can put a car in a trust — but for most people it's more hassle than it's worth. Vehicle titles are handled at the DMV and many states make retitling to a trust cumbersome. Auto insurance becomes more complicated. And since vehicles depreciate and typically aren't high-value assets compared to real estate, the probate savings are modest.
Exceptions
Classic cars, collector vehicles, or any vehicle worth $50,000+ may be worth including. In many states you can also add a TOD (Transfer on Death) designation to a vehicle title, achieving the same probate-avoidance result without the insurance complications of trust ownership.
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💊 Health Savings Accounts (HSA)
HSAs are individual accounts tied to you as a person. Like IRAs, transferring ownership to a trust triggers immediate taxation. And unlike IRAs, the tax treatment at death for non-spouse beneficiaries is even harsher — they're treated as receiving ordinary income on the full balance immediately.
The Right Approach
Name your spouse as primary beneficiary — a spouse can inherit an HSA and continue using it tax-free as their own HSA. Name other individuals as contingent beneficiaries directly on the HSA form. Never name the trust.
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🎓 529 College Savings Plans
529 plans are owned by individuals and can be passed to a successor owner by beneficiary designation. Transferring ownership to a trust may disqualify certain state tax deductions, complicate the account's treatment, and provide no meaningful benefit since a simple successor owner designation achieves the same estate planning result.
The Right Approach
Name your spouse or another trusted adult as successor account owner. The account continues for the benefit of the original beneficiary (your child or grandchild) without any interruption or court involvement.

The Step-Up in Basis: Why It Changes Everything for Brokerage Accounts

Understanding the Step-Up in Cost Basis

This is one of the most powerful tax benefits in the entire U.S. tax code — and one of the least understood. It's the reason taxable brokerage accounts should generally be held in a revocable trust (not an irrevocable one) and absolutely not in an IRA.

Here's how it works: your cost basis is what you paid for an investment. Capital gains taxes are owed on the difference between your basis and what you sell it for. When you inherit an investment, the IRS "steps up" your cost basis to the fair market value on the date the original owner died — wiping out all accumulated gains.

Example:
You buy 1,000 shares of a stock in 1995 for $10/share → basis = $10,000
At your death in 2025, the stock is worth $80/share → fair market value = $80,000
Embedded capital gain = $70,000 (taxed at 15–20% if sold) = up to $14,000 in potential taxes

With Step-Up in Basis:
Your heirs inherit the shares with a new basis of $80/share
If they sell immediately → $0 in capital gains taxes
Tax savings: up to $14,000 on this one position alone

For large brokerage accounts with decades of appreciated holdings, the step-up in basis can eliminate hundreds of thousands of dollars in embedded capital gains taxes for your heirs. A revocable living trust preserves this benefit entirely because the IRS treats it as if you personally own the assets. An irrevocable trust does not receive this treatment — which is why keeping appreciated investments in a revocable (not irrevocable) trust is so important.

IRAs, by contrast, never receive a step-up in basis — every dollar withdrawn is taxed as ordinary income by your heirs. This is another reason IRAs and brokerage accounts have fundamentally different estate planning implications, and why you need a different strategy for each.

How to Fund Your Trust: Asset by Asset Reference

Asset Type Action Required How to Do It Notes
Primary Home New Deed Prepare & record a new deed at county recorder's office Attorney can prepare; small recording fee required
Vacation / Rental Property New Deed Separate deed for each property, in each county Multiple states = multiple probate avoidances
Bank / Savings Accounts Retitle Account Visit bank with trust certification; update account ownership Or add trust as POD beneficiary as alternative
Brokerage Account Retitle Account Contact brokerage; provide trust cert; update registration No tax consequence; step-up in basis preserved
LLC / Partnership Interest Assignment Amend operating agreement; update membership records S-corp: confirm trust qualifies as eligible shareholder
Valuable Personal Property Written Assignment Signed assignment document listing specific items Keep with trust documents; update periodically
Life Insurance Beneficiary Change Name trust as primary or contingent beneficiary on policy form Don't transfer ownership — just update the beneficiary
IRA / 401(k) Beneficiary Only Name individuals directly on beneficiary designation form Never retitle to trust — triggers immediate taxation
HSA / 529 Beneficiary / Successor Name spouse or individual as beneficiary/successor owner Never transfer ownership to trust
The Most Common Mistake

Signing your trust and then doing nothing else. A trust that holds no assets provides zero benefit. The funding process — retitling accounts, recording deeds, updating beneficiaries — is where the real work happens and where most people stall. Set a deadline of 90 days after signing your trust documents to complete the funding. Put it on your calendar now.

The 5 Most Common Trust Funding Mistakes

01
Creating the Trust But Never Funding It
The single most common estate planning failure. A beautifully drafted trust that holds no assets is worthless. Every asset still passes through probate, as if the trust never existed.
02
Putting IRAs or 401(k)s Into the Trust
This triggers an immediate taxable distribution of the entire account balance. On a $500,000 IRA, that could be $150,000+ in unexpected taxes in a single year. Never do this.
03
Buying Real Estate in Your Own Name After Funding
If you add property to your estate after setting up the trust — a new home, an investment property — and don't deed it into the trust, that property is still a probate asset. The trust must be funded with every asset, including new acquisitions.
04
Not Updating After a Refinance
Many lenders require you to temporarily remove your home from the trust during a refinance. After closing, the property must be deeded back into the trust. Many homeowners skip this step, unknowingly pulling their home back into probate exposure.
05
No Pour-Over Will as a Backstop
A pour-over will directs any assets that weren't transferred into the trust to flow into it at death. It's a safety net for assets you forgot to transfer or acquired at the end of life. Make sure your trust is accompanied by a pour-over will — they work together.
06
Never Reviewing After Major Life Changes
A trust created when your kids were minors may need updates when they're adults, married, or have their own children. Review your trust after every major life event and with your attorney every 5 years.

Your Trust Funding Checklist

After Signing Your Trust — Complete These Steps
✓Primary home: Prepare and record a new deed transferring title to your trust at your county recorder's office.
✓Other real estate: Deed each property into the trust, filed in the appropriate county for each property.
✓Bank accounts: Visit each bank to retitle accounts to the trust, or designate the trust as POD beneficiary.
✓Brokerage accounts: Contact each brokerage to retitle taxable investment accounts to the trust.
✓Business interests: Amend operating agreements, partnership agreements, or stock records to reflect trust ownership.
✓IRA / 401(k): Leave in your name — update beneficiary designations directly with the plan administrator.
✓Life insurance: Update beneficiary designations to name the trust or specific individuals as appropriate.
✓HSA / 529: Name spouse or individual as beneficiary/successor owner directly — never the trust.
✓Valuable personal property: Complete a written Assignment of Personal Property and keep it with your trust documents.
✓Pour-over will: Confirm your attorney included a pour-over will as a backstop for any assets outside the trust.
✓After any refinance: Re-deed your home back into the trust if your lender required removal during closing.
✓New acquisitions: When you buy new real estate or open new accounts, immediately title them in the trust name.
Dad's Final Word

"Funding a trust is unglamorous work. You're calling banks, visiting the county recorder, filling out forms. None of it is fun. But when you're done, you've given your family an enormous gift — the ability to settle your estate in weeks instead of fighting probate for over a year. Do the paperwork now so they don't have to deal with the courts later."

Disclaimer: This article is for educational purposes only and does not constitute legal, tax, or financial advice. Trust laws, tax rules, and beneficiary designation requirements vary by state and change over time. The step-up in basis rules described reflect current federal tax law and may change. Always consult a qualified estate planning attorney and tax advisor before making decisions about trust funding or asset transfers.