Will vs Revocable Living Trust in Maryland: Pros and Cons of Each Estate Planning Option
When planning an estate in Maryland, two of the most common legal tools are a Last Will and Testament and a Revocable Living Trust (RLT).
Both can effectively transfer assets to heirs and ensure your wishes are followed after death. However, they operate very differently and serve different planning goals.
Some individuals are well served by a simple will and the Maryland probate process, while others benefit from the flexibility and structure of a revocable living trust.
There is no single solution that works for everyone. The right choice depends on a person's assets, family situation, privacy concerns, and long-term planning goals.
Below is a comparison of the advantages and disadvantages of wills and revocable living trusts under Maryland law.
Three points you must understand:
(1) A Will controls assets solely in your name. If you have assets that are: joint; have designated beneficiaries; are pay on death; are transfer on death; or in some way are not solely in your name, those designations control - not your Will.
(2) An RLT is essentially a way to avoid the probate process. It works because you transfer ownership of your assets to the Trust so that they are no longer solely in your name. Rather, they are in the name of the Trust.
(3) If your motivation to do a Trust is to avoid the probate process, you cannot make an informed decision unless you understand how the probate process works.
Estate Planning With a Will in Maryland
A Last Will and Testament directs how your property will be distributed after death and appoints a Personal Representative (executor) to administer the estate through the Maryland probate system.
Advantages of Using a Will
Court supervision provides guidance and protection
● The Maryland probate system provides structured oversight through the Register of Wills and the Orphans' Court.
● Courts can issue orders clarifying ambiguous provisions or authorizing certain actions by the Personal Representative.
Protection for the Personal Representative
● Court approval can help shield a Personal Representative from later claims of mismanagement.
Clear timeline for challenges
● In Maryland, challenges to a will generally must be filed within six months after the appointment of the Personal Representative, providing relatively quick finality for heirs.
Minimal lifetime administration
● A will does not require transferring ownership of accounts or real estate during life.
Often sufficient for simpler estates
●For individuals with straightforward assets located primarily in Maryland, a will-based estate plan may be efficient and cost-effective.
Works with beneficiary designations
● Retirement accounts, life insurance policies, and payable-on-death accounts can pass directly to beneficiaries outside probate.
Disadvantages of Using a Will
Probate is required
● Assets owned individually must typically pass through the Maryland probate process before distribution.
Administrative requirements
● Probate can involve inventories, notices to creditors, appraisals, and estate accountings.
Appraisal requirements in Maryland
● Certain categories of property may require formal appraisals, which can increase costs and delay in some estates.
Ancillary probate for out-of-state property
● If the decedent owns real estate in another state, a second probate proceeding may be required there.
Public record
● Probate filings are generally public, meaning details about assets and beneficiaries may become part of the public record.
Testamentary trusts depend on probate
● Trusts created inside a will do not become active until the will is admitted to probate.
Estate Planning With a Revocable Living Trust in Maryland
A Revocable Living Trust (RLT) is created during a person's lifetime and holds legal title to assets.
Typically, the person who creates the trust serves as the initial trustee, with a successor trustee taking over if the grantor becomes incapacitated or passes away.
Advantages of a Revocable Living Trust
Avoids probate
●Assets properly titled in the trust generally pass to beneficiaries without going through probate.
Continuity during incapacity
● If the grantor becomes incapacitated, the successor trustee can manage trust assets without court involvement.
Greater privacy
● Unlike probate proceedings, trust administration generally occurs privately and outside the court system.
Immediate authority for the successor trustee
● The successor trustee derives authority directly from the trust document and does not need court appointment.
Avoids ancillary probate
● Real estate titled in the trust can transfer without separate probate proceedings in other states.
Centralized estate administration
● Multiple assets can be administered under one coordinated trust structure rather than through a combination of probate and beneficiary designations.
Useful for mobile clients
● A revocable trust can simplify administration if a person moves to another state or owns property in multiple states.
Disadvantages of a Revocable Living Trust
No asset protection from creditors
● Because the trust is revocable, assets remain subject to the grantor's creditors during life and after death.
No special tax advantages
A revocable living trust generally provides no tax benefits beyond those available with a properly drafted will.
Upfront work to fund the trust
● Assets must be retitled into the trust during the grantor's lifetime. Failure to do so may result in assets still going through probate.
Less court oversight
● While privacy can be beneficial, trustees do not have the same routine court supervision available in probate.
Potential fiduciary disputes
● Trustees, especially family members serving as trustees, may face claims from beneficiaries alleging breach of fiduciary duty.
Trust contests may last longer
● Maryland law allows a longer default period for challenging a trust unless formal notice procedures shorten it.
Important Misconception: Trusts Do Not Automatically Protect Assets
Many people believe a revocable living trust protects assets from creditors or long-term care costs.
In reality:
● A revocable living trust does not protect assets from creditors.
● A will also does not provide asset protection.
Planning for issues such as long-term care costs or Medicaid eligibility usually requires additional strategies, such as properly structured irrevocable trusts or Medicaid asset protection planning.
Choosing the Right Estate Planning Tool
A will and a revocable living trust are simply different estate planning tools.
The right approach depends on many factors, including:
● Types and value of assets
● Whether real estate exists in multiple states
●Family dynamics
●Privacy concerns
● Incapacity planning needs
● Administrative preferences for heirs
For some individuals, a will-based plan works perfectly well.
For others, a revocable living trust may offer meaningful advantages.
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