As Naperville estate planning attorneys, we frequently hear questions from clients about whether revocable trusts remain necessary now that Illinois law permits Transfer on Death Instruments (TODIs). Some assume that TODIs have made trusts unnecessary, but this overlooks the broader role that revocable trusts play in a comprehensive estate plan. While TODIs can be helpful tools for transferring real property, they are limited in scope. A revocable trust offers greater flexibility, control, and protection for families, particularly when managing complex estates or navigating sensitive family dynamics.
Illinois law provides a framework for both TODIs and revocable trusts. Under the Illinois Trust Code, 760 ILCS 3/101 et seq., individuals can create revocable trusts to hold assets, manage distributions, and avoid the probate process. By contrast, the Illinois Residential Real Property Transfer on Death Instrument Act, 755 ILCS 27/1 et seq., allows property owners to transfer real estate directly upon death without probate. Both tools serve valuable purposes, but revocable trusts remain the more comprehensive option for most clients.
Our role as attorneys is to help clients understand the strengths and limitations of each tool, and to design estate plans that truly protect families and preserve wealth. Revocable trusts continue to be one of the most effective ways to achieve these goals.
A Transfer on Death Instrument is a deed that allows real estate to pass automatically to a named beneficiary when the owner dies. It is a useful probate-avoidance tool for homeowners who want to transfer a primary residence or investment property. Under 755 ILCS 27/15 et seq., a TODI must be executed, notarized, and recorded before the owner’s death to be valid.
While TODIs provide a streamlined way to transfer real estate, they do not apply to other types of property, such as bank accounts, business interests, or personal assets. They also do not provide management of assets if the owner becomes incapacitated. For families with more than one property, or with children who need long-term financial guidance, a TODI is not enough.
A revocable trust provides far greater control than a TODI. Under 760 ILCS 3/602 et seq., the grantor retains the right to amend or revoke the trust during life. Assets placed into the trust avoid probate, just like with a TODI, but the trust also allows for ongoing management of property during the grantor’s lifetime. If incapacity occurs, the successor trustee can step in without the need for guardianship proceedings.
Trusts also allow families to tailor how and when beneficiaries receive property. For example, parents can create staggered distributions for children, protect assets from creditors, and ensure funds are used responsibly. Unlike a TODI, which results in a direct transfer upon death, a trust can build safeguards into the estate plan.
Family disputes often arise during divorce or child custody cases, where issues of parental alienation under 750 ILCS 5/602.7 may affect relationships with children. These conflicts sometimes carry over into estate planning. A revocable trust can help reduce conflict after death by setting clear instructions for distributions, naming trustees who will enforce those terms, and limiting opportunities for litigation. In this way, trusts not only protect assets but also provide stability in families that have faced high-conflict situations.
Another advantage of revocable trusts is privacy. Probate is a public process, meaning that court filings can reveal details about a family’s finances and beneficiaries. Because assets in a trust transfer outside of probate, families keep these matters private. This is particularly important for business owners and high-net-worth individuals who do not want sensitive financial details available in public records.
Trusts also allow for more efficient administration. While TODIs transfer real estate immediately, beneficiaries may still face challenges if debts need to be resolved or multiple heirs are involved. A trust streamlines asset management and ensures that one trustee is in charge of handling obligations before making distributions.
TODIs are valuable tools when used correctly, but they are not substitutes for revocable trusts. Trusts remain the most comprehensive way to:
For Illinois families, combining a revocable trust with TODIs and other estate planning tools often provides the strongest protection. We advise clients to think of TODIs as part of a larger plan, rather than a replacement for trusts.
A revocable trust can hold many different types of assets and provides management during life and after death, while a TODI only applies to real estate and transfers ownership automatically upon death.
Yes. Assets properly titled in a revocable trust are not subject to probate under Illinois law. This saves time, reduces costs, and keeps family affairs private.
Yes. Under 760 ILCS 3/602, a grantor may revoke or amend a revocable trust at any time while living, as long as they are competent. This flexibility makes trusts ideal for people whose circumstances may change.
Generally no. While TODIs can transfer each property separately, coordinating multiple TODIs can become complex. A revocable trust consolidates all properties under one legal instrument, simplifying management and administration.
If the grantor becomes incapacitated, the successor trustee can step in to manage the trust assets immediately, avoiding the need for guardianship proceedings. A TODI only takes effect after death and offers no protection during life.
Yes. A trust allows parents to set conditions for distributions, stagger inheritance, or provide oversight for young or financially inexperienced children. TODIs transfer property outright, with no restrictions or safeguards.
Under 750 ILCS 5/602.7, courts recognize the impact of parental alienation in custody decisions. In estate planning, similar conflicts can arise after death. A revocable trust helps reduce disputes by setting clear instructions and limiting court involvement.
Yes, but the benefits outweigh the initial cost. A trust provides comprehensive coverage for all assets, protects against incapacity, and reduces conflict. Over time, the savings from avoiding probate and disputes often exceed the upfront expense.
Yes. Many clients use TODIs for specific real estate while holding other assets in a revocable trust. Together, they form a strong estate plan that avoids probate and provides flexibility.
At Keller Legal Services, we believe that revocable trusts remain an essential foundation for Illinois estate plans, even with TODIs available. Our attorneys help families design plans that protect assets, reduce disputes, and provide long-term security.
Contact our Naperville revocable trust lawyer at Keller Legal Services by calling 630-505-1515 to receive your free consultation. From our office in Naperville, we represent clients throughout Chicago and across Illinois.
