Personal property is all of your “stuff” that doesn’t have title documentation. Examples of personal property include: furniture, appliances, jewelry, stamp collections, clothing, etc. Funding personal property is an often overlooked step in the trust funding process. This is unfortunate since many people hold significant wealth in their personal property, and transferring this items to trust is a relatively straight forward process.
Transferring personal property to trust can be accomplished though executing a Bill of Sale. [A bill of sale may also be referred to as an “Assignment”.] In your typical revocable trust situation, a bill of sale is simply a sales contract between the grantor as an individual and the grantor as trustee of his trust.
In most cases, this general bill of sale suffices to transfer into trust property that does not bear a title instrument. However, in dealing with assets of significant value, it may be advisable to execute a specific bill of sale for the specific piece of property. While the general bill of sale will accomplish the same, the specific bill of sale will lessen a challenge to the funding after death.
It’s important to distinguish that a bill of sale is used to transfer property that does not have title documentation. Vehicles, boats, and other personal property that has (or should have) title are funded in a different manner. These topics are addressed in later articles.