Arizona Revocable Living Trust: Avoid Probate Today

What Is a Revocable Living Trust?

A revocable living trust is an estate planning tool you create during your lifetime to hold title to your assets. You (the grantor, also called the settlor) typically serve as trustee and beneficiary while you are alive, retaining full control and the ability to amend or revoke the trust at any time. Upon death or incapacity, a successor trustee you name manages and distributes trust assets according to your instructions under Arizona law (A.R.S. Title 14, ch. 11).

Why Arizona Families Use Revocable Trusts

• Probate avoidance: Assets properly titled in your trust generally pass to beneficiaries without opening a court-supervised probate estate, which can save time and maintain privacy; trust administration is still required and exceptions may apply.
• Incapacity planning: If you become incapacitated, your successor trustee may step in to manage trust assets without a separate conservatorship proceeding for those assets.
• Privacy: Unlike a probate file, a trust is generally private.
• Flexibility: Because the trust is revocable, you can amend or revoke it as your life and goals change.
• Multi-state property: A trust can help minimize multiple ancillary probate proceedings when you own real estate in more than one state.

What a Revocable Trust Does Not Do

• It does not inherently reduce income, estate, or property taxes. Additional planning may be required.
• It does not protect assets from your own creditors while the trust is revocable and you retain control (A.R.S. § 14-10505).
• It does not control assets that are not properly funded into the trust or coordinated with beneficiary designations.

Key Arizona Legal Points

• Arizona has adopted a version of the Uniform Trust Code governing creation, validity, modification, and administration of trusts (A.R.S. Title 14, ch. 11; see also Title 14 overview).
• A trust can hold Arizona real property; title should be conveyed to the trustee by deed, and a certification of trust may be used to evidence trustee authority (and may be recorded when dealing with real property) (A.R.S. § 14-1013).
• An unfunded trust will not avoid probate for assets left outside the trust. Proper titling and beneficiary coordination are essential.
• After the settlor’s death, a trustee owes statutory duties to qualified beneficiaries, including providing information and reports upon request (A.R.S. § 14-10801 et seq.).
• While a trust is revocable and the settlor retains control, the settlor’s creditors may reach trust assets as provided by statute (A.R.S. § 14-10505).

How to Set Up an Arizona Revocable Living Trust

• Define goals and beneficiaries: Identify who receives what, and when.
• Choose fiduciaries: Name a successor trustee and backups; consider a trust protector only if appropriate.
• Draft the trust: Include Arizona governing law, trustee powers, incapacity standards, distribution terms, and tax provisions tailored to your situation.
• Execute with formalities: Sign the trust and any certifications in compliance with Arizona law; notarization is commonly used and often requested by financial institutions or county recorders.
• Fund the trust: Re-title bank and brokerage accounts, record deeds for real estate, and assign interests in LLCs or closely held businesses. Coordinate beneficiary designations on life insurance and retirement accounts with your plan.
• Create supporting documents: Durable financial power of attorney, health care power of attorney, HIPAA authorization, and a pour-over will to capture any assets not previously transferred.

Practical Tips

Avoiding Common Pitfalls

• Not funding the trust: Leaving key assets outside the trust can lead to a probate proceeding.
• Misaligned beneficiary designations: Coordinate retirement accounts and life insurance with the trust plan to meet tax and distribution goals.
• Out-of-state real estate: Ensure deeds in other states are properly titled to the trust to minimize multiple court proceedings.
• Lack of successor planning: Name backups for trustees and beneficiaries; plan for minors or special needs with subtrusts.
• No trustee guidance: Provide practical instructions and maintain an up-to-date asset list to streamline administration.

Trust Administration After Death or Incapacity

• Successor trustee acceptance and documentation: Provide a certification or affidavit of trust as requested by institutions (A.R.S. § 14-1013).
• Notice and information to beneficiaries: Arizona law outlines when and what information must be provided to qualified beneficiaries (A.R.S. § 14-10801 et seq.).
• Inventory and valuation: Collect and value trust assets; obtain appraisals when needed.
• Debts, expenses, and taxes: Pay legitimate obligations and file any required tax returns.
• Distributions: Make interim or final distributions consistent with the trust terms and applicable law.
• Accounting: Maintain records and provide reports or accountings as required or upon request under Arizona law.

Who Should Consider a Revocable Living Trust?

Arizonans who want to streamline transfers at death, maintain privacy, plan for incapacity, own real estate, have blended families, or hold assets in multiple states often benefit from a revocable trust. Individuals with modest estates may also use a trust where privacy and ease of administration are priorities.

FAQ

Does a revocable trust avoid probate in Arizona?

Generally yes, for assets properly titled in the trust. Assets left outside the trust may still require probate or a small-estate procedure.

Do I still need a will if I have a trust?

Yes. A pour-over will captures any assets not transferred to the trust and names guardians for minor children.

Can my creditors reach assets in my revocable trust?

While the trust is revocable and you retain control, Arizona law allows your creditors to reach trust assets to the extent provided by statute.

Will a revocable trust reduce taxes?

No by itself. Additional tax planning may be required depending on your estate size and goals.

Who should be my successor trustee?

Choose a trustworthy, organized person or a professional fiduciary, and consider naming backups.

Next Steps

• Review your goals and family structure.
• Gather statements and deeds for your assets.
• Speak with an Arizona estate planning attorney to draft and fund a trust tailored to you.
• Revisit your plan after major life events such as marriage, divorce, birth, death, or significant financial changes.

Ready to discuss your plan? Contact our Arizona estate planning team.

Sources

• Arizona Revised Statutes Title 14, Chapter 11 (Arizona Trust Code)
• Arizona Revised Statutes Title 14 (Trusts, Estates and Protective Proceedings)
• A.R.S. § 14-10505 (Creditor claims against settlor of revocable trust)
• A.R.S. § 14-10801 et seq. (Duties of trustee; general standards)
• A.R.S. § 14-1013 (Methods of proving facts concerning trusts)
• Arizona Legislature – A.R.S. Title Index

Disclaimer

This article provides general information about Arizona law as of the date above. It is not legal advice and does not create an attorney-client relationship. Laws change and every situation is different—please consult an Arizona-licensed attorney about your specific circumstances.