New Jersey Estate Planning Attorney Christine Matus Guides Families Through the Living Trust Funding Process
TOMS RIVER, NJ – October 20, 2026 – A living trust can only protect assets that have been properly transferred into it, and failing to complete the funding process is one of the most common estate planning mistakes New Jersey families make. New Jersey estate planning attorney Christine Matus of The Matus Law Group (https://matuslaw.com/how-to-fund-living-trust/) is providing guidance on how to fund a living trust, which assets can be transferred, and how to avoid the probate process for families in Ocean County and throughout the state.
According to New Jersey estate planning attorney Christine Matus, funding a living trust means transferring ownership of assets from an individual’s name into the name of the trust. Under the New Jersey Uniform Trust Code, N.J.S.A. 3B:31-1 et seq., a trust is a legal arrangement where a trustee holds and manages property for the benefit of named beneficiaries, but the trust can only manage assets that have been properly retitled or assigned to it. Most types of property can be transferred, including real estate, bank accounts, investment accounts, business interests, and personal property, though each type requires a different process. “A trust that is never funded provides no benefit at all,” explains Matus. “The assets remain in the individual’s name and must pass through probate, which is exactly what the trust was designed to avoid.”
New Jersey estate planning attorney Christine Matus notes that real estate is often the most valuable asset in a New Jersey estate and requires specific documentation for transfer. A new deed, typically a quitclaim deed or bargain and sale deed, must be prepared to convey ownership from the individual to the trustee of the trust. The deed must be signed, notarized, and recorded with the county clerk’s office in the county where the property is located, along with the appropriate GIT/REP form and an Affidavit of Consideration if claiming a Realty Transfer Fee exemption. For homeowners in Ocean County, deeds are recorded at the Ocean County Clerk’s Office at 118 Washington Street in Toms River.
Attorney Matus adds that bank accounts and investment accounts are among the easiest assets to transfer into a living trust. The process involves contacting each financial institution and completing retitling paperwork, typically using a certification of trust under N.J.S.A. 3B:31-81 that confirms the trust exists and identifies the trustee without sharing the full trust terms. “Retirement accounts require a different approach entirely,” she notes. “Transferring ownership of an IRA or 401(k) directly into a trust can trigger immediate income tax on the entire account balance. Instead, individuals typically name the trust as a beneficiary.”
The firm advises that life insurance policies present a similar choice regarding trust funding. Naming the trust as the policy’s beneficiary gives the trustee control over how proceeds are distributed and keeps the funds out of probate. If the policy is payable to the estate rather than a named beneficiary, the proceeds become part of the probate estate and may be subject to New Jersey inheritance tax. Business interests, including LLC membership interests and partnership shares, can be transferred through assignment documents and amended operating agreements, while tangible personal property such as jewelry and artwork can be transferred using a written assignment.
Many homeowners in New Jersey worry about triggering a mortgage due-on-sale clause when transferring property into a trust. Under the federal Garn-St. Germain Depository Institutions Act of 1982, lenders generally cannot enforce a due-on-sale clause when a borrower transfers property into a revocable living trust, provided the borrower remains a beneficiary and continues to occupy the property. Notifying the lender before making the transfer is still a recommended practice to prevent administrative confusion.
A pour-over will serves as a safety net for any assets that remain outside the trust at the time of death, directing those assets into the trust after passing through probate. A revocable living trust is generally treated as a grantor trust for tax purposes during the grantor’s lifetime, meaning income is reported on the personal tax return. New Jersey repealed its state estate tax effective January 1, 2018, but the state’s inheritance tax still applies to certain beneficiaries based on their relationship to the deceased, with Class A beneficiaries such as spouses and children exempt from the tax.
Common trust funding mistakes include forgetting to transfer newly acquired property, overlooking beneficiary designations on retirement accounts and life insurance policies, and failing to update the trust after major life changes such as marriage, divorce, or the birth of a child. Vehicles can also be transferred into a trust, though New Jersey requires a title change through the Motor Vehicle Commission, and the new title would list the trust as the owner. Contacting the auto insurance provider before making the change is advisable to avoid gaps in coverage.
“Regularly reviewing a trust and its funded assets is important, especially after major life changes such as marriage, divorce, or the purchase of new property,” advises Matus. “New assets acquired after creating a trust must also be transferred, or they may end up in probate despite having a trust in place.”
For those in New Jersey seeking to establish or fund a living trust, working with an estate planning attorney may help ensure that every asset is properly titled and protected from the probate process.
About The Matus Law Group:
The Matus Law Group is a Toms River-based law firm focused on estate planning, trust administration, and real estate law. Led by attorney Christine Matus, the firm serves families throughout Ocean County, Monmouth County, and the state of New Jersey. For consultations, call (732) 281-0060.
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Company Name: Matus Law Group
Contact Person: Christine Matus
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Phone: (732) 281-0060
Address:81 E Water St #2C, Toms River, NJ 08753
City: Toms River
State: New Jersey
Country: United States
Website: https://matuslaw.com/
