A trust is a legal entity created by a grantor who wishes to have the trustee manage certain property for the benefit of the trust beneficiaries. The trustee—the person or entity that administers the trust—takes legal title to any property the grantor transfers into the trust and manages it according to the grantor’s instructions in the trust agreement.
  A revocable living trust is one created during the grantor’s lifetime and which the grantor may alter, amend or revoke. However, when the grantor dies, the trust either becomes irrevocable or terminates, and the property in the trust is held and/or distributed according to the terms of the trust agreement.
  A revocable living trust does not provide tax advantages to the grantor while living or at death. Instead, the main purposes of such a trust are:
To avoid probate on assets transferred into the trust during the grantor’s life;

To receive life insurance proceeds payable to the trust when the grantor/insured dies;
To receive probate assets pouring over into the trust at the grantor’s death, under the terms of the grantor’s will;
To keep the grantor’s disposition of property from becoming public (unlike a will, which, admitted to probate, is subject to inspection by the public);
To control the disposition of trust assets through the terms of the trust;
To provide for management of the trust assets in the event of the grantor’s incapacity.
  An attorney who specializes in estate planning should prepare the written trust agreement according to the grantor’s stated objectives. The key issues to be included in the trust agreement are these:
Who will receive the trust income and how long will income payouts last (or, if no payout of income is stipulated, how long will income be accumulated)?

Who is to receive distributions of the trust principal and when?
When will the trust terminate?
  Since the trust is revocable, it may be amended at any time. Unlike a testamentary trust, which becomes available for public inspection when a will is filed for probate, the revocable living trust remains private.
A trust may be a “shell” during the grantor’s lifetime, which means it is inactive, but the written agreement prescribes what will happen when the grantor dies. What often happens is that life insurance proceeds are paid into the trust along with assets passing under the will after probate. This is often called a “pourover” trust. This trust becomes irrevocable when the grantor dies.
  The trust may also be active, of course, with the grantor transferring assets of any type during his or her lifetime. The trustee can be made responsible for investment decisions, payment of taxes and all other administrative functions. Typically, the grantor will receive any income the trust generates since the income will be taxed to the grantor in any event.
  While a revocable trust can provide the grantor with the means to avoid probate of the property in the trust, there are some disadvantages:
The grantor derives no federal income tax or estate tax benefits from the trust.

A trust may be more expensive to establish than a will. It will require legal fees to draft the trust and additional fees to have it administered by a professional trustee.
Assets in the trust are subject to the claims of creditors of the estate when the grantor dies.
  Several methods may be used to fund a revocable living trust:
Name the trust as the beneficiary of life insurance benefits;

Transfer certain assets to the trust as soon as it is established;
Arrange to transfer assets to the trust later—typically when there seems to be a high risk of death, disability or incapacity;
In the will, name the trust as beneficiary of certain assets or of the entire net probate estate.