The assets that should go in a trust are real estate, bank and brokerage accounts, business interests, valuable personal property, intellectual property, and digital assets including cryptocurrency. The assets that should stay out of a trust, at least as far as retitling is concerned, are retirement accounts, life insurance, and health savings accounts, because the IRS treats a change of ownership on those as a taxable event. Vehicles and accounts that already carry payable-on-death or transfer-on-death designations usually don’t need the trust either. Deciding what assets should and shouldn’t go in a trust is less about the trust document itself and more about how each asset is taxed and titled.
Revocable or Irrevocable Changes the Answer
Which trust you’re funding shapes which assets make sense inside it.
A revocable living trust leaves you in full control. You can change terms, move assets in and out, or dissolve the trust entirely. The IRS and Medicaid both treat those assets as still yours. Everything in a revocable trust is included in your gross estate at death because you kept the power to alter or revoke the transfer.1Office of the Law Revision Counsel. 26 USC 2038 – Revocable Transfers What you get in exchange is probate avoidance: a properly funded revocable trust passes assets to beneficiaries without court involvement, privately and faster than a will.2The American College of Trust and Estate Counsel. How Does a Revocable Trust Avoid Probate?
An irrevocable trust requires giving up control. You can’t amend it or take the assets back. In return, those assets leave your taxable estate and sit beyond the reach of most creditors. For 2026, the federal estate tax exemption is $15 million per person, made permanent by the One, Big, Beautiful Bill Act signed in July 2025.3Internal Revenue Service. Whats New Estate and Gift Tax Most families won’t owe federal estate tax regardless of which trust they use, so probate avoidance, privacy, and long-term care planning tend to drive the decision more than tax exposure.
Real Estate
Real estate is the asset most people put in a trust first. When a home passes through probate, the process becomes public record, can take months, and generates legal fees that come out of the property’s value. A primary residence, vacation home, or investment property transferred into a revocable trust passes to beneficiaries privately and without court delay.
Mortgaged property is fine. Federal law prevents a lender from calling the loan due when you transfer your home into a trust where you remain a beneficiary and the people living there don’t change. That protection, under the Garn-St. Germain Act, covers residential property with fewer than five units.4Office of the Law Revision Counsel. 12 USC 1701j-3 – Preemption of Due-on-Sale Prohibitions
To transfer real estate, you prepare a new deed naming the trustee as owner and record it with your county recorder. Recording fees are modest, and the transfer usually doesn’t trigger a property tax reassessment. If you carry title insurance, confirm with the insurer that coverage continues.
Bank and Brokerage Accounts
Checking, savings, brokerage, and mutual fund accounts belong in a trust if you want them to avoid probate. Contact each institution, request their retitling forms, and provide either a copy of the trust or a Certificate of Trust that summarizes the trust name, date, and trustee authority.5Citizens Bank. Certificate of Trust for Revocable Trust Most banks and brokerages process the change within a few business days.
The Certificate of Trust is worth knowing about. Rather than handing over the full trust document, which may map out your entire estate plan, the certificate gives the institution only what it needs to verify the trust exists and that the trustee can act. Many banks prefer it.
Business Interests
Shares in a closely held business, LLC membership interests, and partnership interests can be moved into a trust so the business survives your death without freezing. Without a trust, operations can stall during probate while partners and employees wait. A trust lets the trustee step in immediately under instructions you wrote in advance.
Mechanics depend on the entity. For an LLC, you assign your membership interest to the trust and update the operating agreement. Check any buy-sell agreement or operating agreement provision first. Some contain transfer restrictions that can trigger a forced buyout if violated, which would defeat the planning entirely.
Valuable Personal Property
Art, jewelry, antiques, and collections can be transferred into a trust through a general assignment document. These items rarely have formal title paperwork, so the assignment serves as written proof the trust owns them. Describe each item specifically enough that nobody has to guess later.
The practical value shows up in family dynamics. Disputes over who gets a ring or a guitar collection fracture more relationships than arguments over money. A trust with clear instructions removes the fight before it starts.
Intellectual Property
Copyrights, patents, and trademarks can keep generating income long after you’re gone. Transferring them into a trust lets the trustee manage licensing, collect royalties, and enforce your rights for the beneficiaries.6Charles Schwab. 4 Steps to Help Protect Your Intellectual Property
Signing an assignment isn’t enough. Patents and trademarks require a formal assignment recorded with the U.S. Patent and Trademark Office. Copyrights should be recorded with the U.S. Copyright Office. Skip these recordings and a licensee can later question whether the trust actually holds the rights. The trust itself should also spell out how the trustee handles royalty income, licensing, and renewals.
Digital Assets and Cryptocurrency
Digital assets are the category most estate plans still miss. Nearly every state has adopted the Revised Uniform Fiduciary Access to Digital Assets Act, which defines digital assets broadly to include email, social media, online purchasing accounts, cloud storage, cryptocurrency, and anything else reachable through a computer or phone.
Cryptocurrency is the hard case because there’s no institution to call. To put crypto in a trust, you can send it to a wallet controlled by the trustee, transfer a hardware wallet with documented proof, or fund an LLC with the crypto and assign the LLC interest to the trust. Whichever route you take, the trustee has to be able to actually access the assets. That means a secure document listing wallet addresses, private keys, passwords, and PINs, stored separately from the trust but referenced in it.
Your trust should expressly authorize the trustee to access devices, manage online accounts, and change passwords. Without that language, federal privacy laws and platform terms-of-service agreements can block access.
Assets to Keep Out of the Trust (and Name as Beneficiary Instead)
Some accounts look like obvious candidates for retitling but carry tax traps that make direct transfer a costly mistake. Each of these already has a beneficiary designation built in, and the IRS has specific rules about ownership changes.
Retirement Accounts
You cannot retitle a 401(k) or IRA into a trust during your lifetime. The IRS treats a change of ownership as a full distribution. Retitle a $500,000 IRA and the IRS treats it as a $500,000 withdrawal. You’d owe income tax on the full amount, plus a 10% early distribution penalty if you’re under 59½.7Internal Revenue Service. Topic No. 413, Rollovers From Retirement Plans A prohibited transaction involving an IRA can also strip the entire account of its tax-advantaged status as of the first day of the year.8Internal Revenue Service. Retirement Topics – Prohibited Transactions
Instead, name the trust as a beneficiary. Many planners recommend naming a spouse as primary beneficiary and the trust as contingent, because a surviving spouse can roll an inherited IRA into their own account and keep tax-deferred growth going. A trust can’t do that. If the trust does inherit, the SECURE Act’s 10-year rule generally forces most non-spouse beneficiaries to empty the account within ten years of the owner’s death.9Internal Revenue Service. Retirement Topics – Beneficiary
Life Insurance
Life insurance paid to a named beneficiary already skips probate. The insurer pays whoever you listed on the policy, so a standard policy with an individual beneficiary doesn’t need to sit inside a trust just to avoid court.
Estate tax is the separate concern. Life insurance proceeds are included in your gross estate if you held any “incidents of ownership” when you died, meaning the right to change beneficiaries, borrow against the policy, or cancel it.10Office of the Law Revision Counsel. 26 US Code 2042 – Proceeds of Life Insurance For an estate approaching the $15 million exemption, that inclusion can create the tax bill the trust was supposed to prevent. An Irrevocable Life Insurance Trust owns the policy instead of you, which keeps the death benefit out of your estate. Transferring an existing policy into one requires surviving three years after the transfer; the IRS pulls the proceeds back into your estate otherwise. Buying a new policy inside the ILIT from the start avoids that waiting period.
Health Savings Accounts
HSAs follow the same pattern as retirement accounts: don’t retitle them. Use the beneficiary designation on the account instead. The tax outcome depends entirely on who you name.
Name your spouse and the HSA simply becomes their HSA, still growing tax-free for qualified medical expenses. Name anyone else, including a trust, and the account stops being an HSA the moment you die. The full fair market value becomes taxable income to the beneficiary that year. If your estate is the beneficiary, the entire balance goes on your final income tax return.11Internal Revenue Service. Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans The only partial relief: qualified medical expenses you incurred that the beneficiary pays within one year of your death reduce the taxable amount.
Assets That Usually Don’t Need to Be in a Trust
Vehicles
Cars, boats, and recreational vehicles can be retitled to a trust, but the paperwork and insurance complications usually outweigh the benefit. For most people, a personal vehicle falls below their state’s small-estate threshold and can transfer to heirs through a simplified process anyway. A classic car or a specialty collection is a different case and may justify putting the vehicle in the trust.
POD and TOD Accounts
Payable-on-death bank accounts and transfer-on-death investment accounts already bypass probate because of the beneficiary designation. The institution transfers the account directly to the person named, regardless of what your will or trust says.12The American College of Trust and Estate Counsel. Pitfalls of Pay on Death (POD) Accounts Trust inclusion isn’t needed for probate avoidance.
The risk is drift. A beneficiary designation overrides your will and trust, so if you updated your trust to split assets among three children but left an old TOD on a brokerage account naming only one child, that one child takes the whole account. Keeping beneficiary designations aligned with your trust is one of the most overlooked maintenance tasks in estate planning.
A Note on Medicaid Planning
If long-term care is on the horizon, the trust type changes the result. Assets in a revocable living trust still count toward Medicaid’s resource limits because you still control them. In some states, a home that would normally be exempt loses that exemption once it goes into a revocable trust. A revocable trust won’t protect assets from Medicaid spend-down.
An irrevocable trust can shelter assets, but federal law imposes a 60-month look-back period. When you apply for Medicaid long-term care benefits, the state reviews asset transfers from the previous five years and applies a penalty period of ineligibility for any transfer made for less than fair market value. The penalty is calculated by dividing the value of the transferred assets by the average monthly cost of nursing home care in your state.13Office of the Law Revision Counsel. 42 US Code 1396p – Liens, Adjustments and Recoveries, and Transfers of Assets Move assets into an irrevocable trust and need Medicaid within five years, and you can land in a gap: ineligible for benefits, no longer able to reach the transferred assets to pay for care. Planning this strategy five or more years before anticipated need is the only way it works reliably.
Funding Is the Step People Skip
The trust has no legal effect over any asset you haven’t formally retitled or assigned to it. Estate planners call this “funding,” and it’s the step most people miss. An unfunded trust is paperwork, not a plan.
- Real estate: prepare and record a new deed naming the trustee; confirm your title and homeowner’s insurance remain in effect.
- Bank and brokerage accounts: complete each institution’s retitling forms and provide a Certificate of Trust.
- Business interests: execute an assignment of your ownership interest and update the operating agreement or corporate records.
- Tangible personal property: sign a general assignment listing the items being transferred.
- Intellectual property: execute assignments and record them with the U.S. Patent and Trademark Office or U.S. Copyright Office.
- Digital assets: transfer cryptocurrency to a trustee-controlled wallet or assign access credentials through a secure document referenced by the trust.
- Retirement accounts, life insurance, HSAs: do not retitle. Update beneficiary designations to name the trust as primary or contingent, depending on the plan.
Review the funding every time your financial picture changes. New account, new property, sold business, new child, divorce. Each of those is a moment when something slips out of alignment with the trust, and alignment is what makes the trust do what it was built to do.