Live in Washington? This article covers the Washington version.
Every estate plan needs one main document that says who receives your property. That document is either a Will or a Revocable Trust.
Your attorney can help you choose. This article explains the difference, so you can come to that conversation ready. It is written for Oregon residents.
Why this decision matters
Choosing between a Will and a Revocable Trust shapes the rest of your plan. It affects:
- Which people you name, such as a Personal Representative, a Trustee, or both
- Which documents your attorney prepares
- How much work you do after signing, such as moving property into a Revocable Trust
- What your family goes through after your death
Key terms
- Testator: The person who makes a Will.
- Grantor: The person, or married couple, who creates a Revocable Trust.
- Trustee: The person or company that holds and manages trust property and makes distributions to beneficiaries. You are usually your own Trustee while you are alive.
- Successor Trustee: The person who takes over as Trustee if you cannot serve or when you die.
- Testamentary trust: A trust that starts at your death to hold property for someone, such as a surviving spouse or a child. It can be written into a Will or a Revocable Trust.
- Personal Representative: The person a court appoints to settle an estate under a Will. Some people say executor.
- Beneficiary: A person or organization that receives property under a Will or a Revocable Trust, now or in the future.
- Probate: The court process that gives a Personal Representative authority to pay bills, file taxes, gather property, and pass it to the beneficiaries.
For more terms, see this article.
How a Will works
A Will says who receives your property and who will settle your estate. It takes effect only at your death.
After you die, a court must appoint the person you named, your Personal Representative, before they can act. That court process is called probate. Your Will then becomes a public court record.
You do not need to move or retitle anything while you are alive. A Will has no effect until it is needed.
How a Revocable Trust works
A Revocable Trust also says who receives your property, but it works while you are alive. You sign it now and move your property into it, usually naming yourself as Trustee. Nothing changes day to day: you keep full control, and you can change or cancel the Revocable Trust at any time.
If you become unable to manage your affairs, or when you die, the Successor Trustee you chose takes over. They do not need a court to appoint them, so property in the Revocable Trust passes without probate.
While you are alive, the Revocable Trust uses your Social Security number and needs no separate tax return. It does not reduce taxes or protect your property from creditors on its own.
A Revocable Trust plan also includes a short “pour-over” Will. It catches anything you forgot to put into the Revocable Trust and sends it there after your death. For example, a car you bought and never retitled would be moved into the Revocable Trust this way.
A Revocable Trust is not the only kind of trust
People often think they need a Revocable Trust to protect a surviving spouse or to save estate tax. That is usually a different kind of trust: one that starts at your death, sometimes called a testamentary trust.
These trusts hold property for someone after you die. For example, a trust can provide for your surviving spouse for life, then pass what is left to your children. A trust can also hold a child’s inheritance until they are older, or help a married couple with estate tax.
You can include these trusts in either a Will or a Revocable Trust, so choosing a Will does not mean giving them up. The choice between a Will and a Revocable Trust is mainly about probate, privacy, and who manages your property if you cannot.
For more, see this article on leaving property outright or in a trust, and this article on trusts for a surviving spouse.
The work a Revocable Trust takes
A Revocable Trust only avoids probate for property you actually put into it. That means signing a new deed for your home and changing the owner on your accounts. When you buy something new, you title it in the Revocable Trust’s name.
Your attorney can tell you which property needs to move and which already passes outside probate. A Revocable Trust that was never funded leaves your family with a probate after all.
Probate in Oregon
Oregon probate involves the court from start to finish. Oregon does not have the “nonintervention” probate that Washington offers.
Your Personal Representative handles day-to-day tasks without asking the court. But they must:
- Publish a notice in the newspaper three weeks in a row
- File an inventory of your property, with values, within 60 days
- File an accounting with the court each year the estate stays open
- Get the court to approve a final accounting before anyone receives their inheritance
Court filing fees rise with the size of the estate and are charged again for each accounting. Your Personal Representative is also entitled to a fee set by state law, based on the value of the estate. Your Will can set a different fee.
The inventory is a public court record, so the value of your property becomes public along with your Will.
This is why Oregon attorneys often recommend a Revocable Trust, especially for people who own a home.
The simple estate affidavit
Oregon has a shortcut that avoids full probate, called the simple estate affidavit. Your family can use it in two situations:
- A small estate: No more than $75,000 of personal property and $200,000 of real estate.
- A Revocable Trust plan: Your Will leaves everything, apart from small specific gifts, to the Revocable Trust you set up during your life.
The second option helps Revocable Trust plans. If some assets were never transferred to your Revocable Trust, your family can often move them there with the affidavit. That avoids a full probate.
Other ways to avoid probate
Some property passes outside probate no matter which document you choose:
- Retirement accounts and life insurance go to the beneficiaries you named on the account.
- Bank and investment accounts can name a payable-on-death or transfer-on-death beneficiary.
- A transfer-on-death deed can pass your home to the people you name.
- Real estate that spouses own together usually passes to the surviving spouse automatically.
These tools work best in simple situations. They cannot set up a trust for a child or plan for a beneficiary who dies before you. A Will or a Revocable Trust can.
Be careful about adding a child or anyone other than your spouse to the title of your Oregon home. In Oregon, that can create a lasting arrangement that neither of you can undo alone. Talk with your attorney first.
Other considerations
A few situations make a Revocable Trust more useful, wherever you live.
Property in another state
If you own real estate in another state, your family may need a second probate there, called an ancillary probate. It adds cost and delay. Putting that property in a Revocable Trust avoids it.
Moving
If you might move to another state, ask your attorney how that state treats Wills and Revocable Trusts. A Revocable Trust usually moves with you more easily.
If you become unable to manage your affairs
With a Revocable Trust, your Successor Trustee manages its property for you. With a Will-based plan, the agent named in your Financial Power of Attorney does that job instead.
Estate tax
Both Washington and Oregon have their own estate tax for larger estates. Married couples sometimes use trusts that start at the first death to reduce it. Those trusts can be built into either a Will or a Revocable Trust. For more, see this article.
Questions to bring to your attorney
- Do I own property in more than one state?
- Would my estate go through probate, or does most of it pass by beneficiary designation?
- How much work would it take to move my property into a Revocable Trust?
- Who would manage my property if I could not?
Want to read more?
These articles are optional.
- Leaving property outright or in trust: How your beneficiaries receive what you leave. See this article.
- Choosing the people who carry out your plan: Personal Representatives and Trustees. See this article.
- Glossary: Common estate planning terms. See this article.
- Questionnaire help: If you are filling in the questionnaire, see the help for the Current Estate Plan page.
- Beneficiary designations: How retirement accounts, life insurance and other property outside your Will fit with your plan. See this article.
- Funding your Revocable Trust: What moving your property into it involves, and whether it is worth the work. See this article.