Who Owns the Property in a Revocable Trust in North Carolina?
Detailed Answer
In North Carolina, a revocable trust serves as a tool for holding and managing assets during your lifetime. Unlike an outright gift, the trust agreement names a trustee to hold legal title to trust assets. At the same time, the person who creates the trust—called the settlor—retains broad powers and benefits from the assets.
Legal Title vs. Equitable Interest
Under N.C. Gen. Stat. § 36C-3-301, the trustee holds legal title to every asset placed into trust. You can appoint yourself as trustee when you create a revocable trust. By doing so, you appear as the record owner of the trust’s bank accounts, real estate deeds, investment accounts, and other assets. Your name goes on the title, deed, or registration, but you hold those assets on behalf of the trust.
At the same time, you, as settlor, keep the equitable interest in the assets. You can:
- Use trust assets for your benefit.
- Change beneficiaries.
- Amend or revoke the trust entirely.
Those powers continue until you either revoke the trust under N.C. Gen. Stat. § 36C-2-601 or you pass away. Upon revocation, title to the assets reverts to you directly, and you become both legal and equitable owner once again.
After Death of the Settlor
When you die, the trust becomes irrevocable. The successor trustee you named steps in, holding legal title and distributing assets to beneficiaries under the trust’s terms. Your beneficiaries gain equitable interests in the assets once distributed.
Why Title Matters
Holding assets in a revocable trust avoids probate, streamlines asset distribution, and offers privacy. The trustee’s name on deeds or account registrations prevents those assets from going through public probate proceedings in North Carolina.
Key Takeaways
- Legal title to trust assets rests with the trustee (N.C. Gen. Stat. § 36C-3-301).
- The settlor retains control, use, and power to amend or revoke the trust (N.C. Gen. Stat. § 36C-2-601).
- During your life, you can serve as trustee and continue managing trust assets directly.
- On the settlor’s death, the successor trustee holds title and distributes property per trust terms.
- Placing assets in a revocable trust helps avoid probate and keeps your affairs private.
Get Personalized Guidance
Determining who holds title and how a revocable trust operates can feel confusing. Pierce Law Group’s probate attorneys guide you through funding a trust, naming trustees, and ensuring your estate plan works as you intend. Reach out today for a consultation. Email us at intake@piercelaw.com or call (919) 341-7055. Let us help you protect and manage your assets through every stage of life.
