Avoid Probate in Maryland: Use a Revocable Living Trust

Why Maryland families consider a revocable living trust

A revocable living trust is a legal arrangement you create during life to hold your assets, managed by a trustee for your benefit. You can amend or revoke it while you are alive and competent. At death, the successor trustee distributes trust assets according to your instructions without a court-administered probate for those assets. Maryland residents often prefer trusts to reduce court involvement, maintain privacy, and create a clearer path for incapacity management. See the Maryland Judiciary’s overview of probate and non-probate property: Wills, Estates & Probate.

How a revocable trust helps avoid Maryland probate

Assets titled in the name of your revocable trust generally pass outside probate, and your successor trustee can gather, manage, and distribute those assets under the trust agreement. Assets that remain titled solely in your name without a valid beneficiary or payable-on-death designation typically require probate. A properly funded trust narrows what is subject to court oversight. Still, some matters—such as creditor claims, tax filings, or unfunded assets—may involve the estate, and in some situations a short probate may be advisable. See: Maryland Judiciary.

Key steps to set up and fund your trust

• Draft the trust agreement naming yourself as initial trustee and a reliable successor trustee.
• Sign with proper formalities under Maryland law and store the original securely.
• Retitle bank and brokerage accounts to the name of your trust.
• Execute and record new deeds to transfer Maryland real estate to the trust, coordinating with your lender and title company.
• Update ownership of closely held business interests per operating agreements or bylaws.
• Coordinate beneficiary designations (life insurance, retirement accounts) so they align with your plan.
• Maintain a pour-over will to capture assets not funded into the trust during life.
• Keep an updated asset list so your successor trustee can act efficiently.

What stays out of the trust (or needs special handling)

• Retirement accounts (401(k), 403(b), IRA) typically should not be retitled to a revocable trust during life; instead, use beneficiary designations coordinated with tax and distribution goals.
• Vehicles may be better addressed at death through titling or applicable beneficiary methods, depending on insurance and financing considerations.
• Accounts with transfer-on-death (TOD) or payable-on-death (POD) designations may already avoid probate; coordinate these with your overall plan to prevent conflicts.

Maryland-specific considerations

• Small estates: Maryland provides a streamlined probate process for certain smaller estates. Eligibility depends on asset type and value and can change over time. See the Maryland Judiciary Small Estate Booklet.
• Non-probate transfers: Maryland recognizes POD/TOD designations and survivorship titling, which can complement a trust. See the Judiciary’s overview: Wills, Estates & Probate.
• Real property: Deeding Maryland real estate to a revocable trust usually requires recording a new deed and may involve recordation and transfer taxes unless an exemption applies. Proper drafting and use of applicable exemptions can avoid unnecessary taxes. See the Maryland Department of Assessments & Taxation on transfer tax: State Transfer Tax.
• Incapacity planning: A revocable trust works alongside a durable financial power of attorney and advance medical directives. Maryland execution rules apply to each document type.

Privacy and speed benefits

Unlike a will that becomes part of the public probate record, a revocable trust generally remains private, which can reduce inquiries from third parties and keep beneficiary shares confidential. Administration can often proceed more quickly, though timing still depends on asset types, creditor issues, and tax filings. See: Maryland Judiciary.

Common pitfalls to avoid

• Creating the trust but not funding it, leaving most assets to pass through probate.
• Forgetting to update real estate deeds after a purchase or refinance.
• Using inconsistent beneficiary designations that bypass the trust and defeat your distribution plan.
• Naming an unprepared or unavailable successor trustee without alternates.
• Overlooking out-of-state property; consider a deed to the trust or a separate trust to avoid multiple probates.

Taxes and a revocable trust

During your lifetime, a revocable trust you control is generally treated as a grantor trust for income tax purposes; income is reported under your Social Security number. A revocable trust does not by itself reduce estate or inheritance taxes. Maryland imposes an estate tax and a separate inheritance tax; planning tools such as marital and bypass trusts, charitable planning, and beneficiary coordination may be appropriate depending on your goals. See the Comptroller of Maryland’s pages on the Estate Tax and Inheritance Tax.

How a pour-over will works with your trust

A pour-over will names your revocable trust as the beneficiary of any assets left in your individual name. Those assets still pass through probate but end up under the trust’s distribution terms. See the Judiciary’s probate overview: Wills, Estates & Probate.

Choosing and preparing your successor trustee

Select someone organized, trustworthy, and able to communicate with beneficiaries and professionals. Provide them with:

• A copy of the trust and any amendments
• An updated asset and contact list
• Information about advisors (CPA, attorney, financial planner)
• Secure access instructions for digital assets where appropriate

Consider professional or corporate trustees if your plan is complex or if family dynamics are challenging.

When to review and update your plan

Revisit your plan when you move, marry, divorce, have a child, buy or sell real estate or a business, experience significant portfolio changes, or when tax laws or Maryland statutes change. Regular reviews help keep titles, deeds, and designations aligned.

FAQ

Does a revocable trust avoid all probate in Maryland?

No. Only assets properly titled in the trust (or passing by beneficiary designation or survivorship) avoid probate. Anything left in your individual name without beneficiaries may require probate.

Do I lose control of my assets?

No. While you are alive and competent, you typically serve as trustee and can amend or revoke the trust at any time.

Should my trust be the beneficiary of my IRA?

Often no, but it depends. Many people name individuals to preserve tax deferral. Using a trust as beneficiary can be appropriate for minor or spendthrift beneficiaries. Get Maryland-specific and tax advice.

Will a revocable trust reduce Maryland estate or inheritance taxes?

No. A revocable trust by itself is not a tax-saving tool, though it can be combined with other strategies that may reduce taxes.

Getting started

An attorney can tailor a Maryland revocable trust to your goals, advise on deed transfers and potential tax exemptions, coordinate beneficiary designations, and prepare companion documents like a pour-over will, powers of attorney, and health care directives. If you are ready to begin, contact our team.

References

• Maryland Judiciary, Wills, Estates & Probate: https://www.mdcourts.gov/legalhelp/willsandprobate
• Comptroller of Maryland, Estate Tax: https://taxes.marylandtaxes.gov/individuals/estate-and-fiduciary-taxes/estate-tax/
• Comptroller of Maryland, Inheritance Tax: https://taxes.marylandtaxes.gov/individuals/inheritance-tax/
• Maryland Department of Assessments & Taxation, State Transfer Tax: https://dat.maryland.gov/realproperty/Pages/StateTransferTax.aspx
• Maryland Judiciary, Small Estate Booklet (Orphans’ Court): https://www.mdcourts.gov/sites/default/files/import/orphanscourt/pdfs/smallestatebooklet.pdf

Disclaimer

This article provides general information about Maryland revocable living trusts and is not legal, tax, or financial advice. Reading it does not create an attorney-client relationship. Laws and procedures change, and outcomes vary by facts. Consult a qualified Maryland attorney for advice about your situation.

Last reviewed: 2025-10-31