Why Your Illinois Living Trust Doesn’t Work Until It’s Funded

 Posted on January 22, 2026 in Estate Planning

Many people believe that signing a living trust document completes their estate planning. They feel relieved knowing they have avoided probate and protected their family's future. Unfortunately, creating a trust is only the first step. Without proper funding, your living trust is like an empty safe. It exists, but it holds nothing of value.

An unfunded trust cannot accomplish any of the goals you created it for. Your assets will still go through probate. Your family will face delays and expenses. Your carefully planned distribution instructions will not apply to property you never transferred into the trust. 

You can avoid this by working closely with a Yorkville, IL estate planning attorney. 

Why Do So Many Trusts Remain Unfunded?

Unfunded trusts are surprisingly common. Many people pay an attorney to create a trust, attend a signing meeting, and then assume the work is done. Some attorneys prepare deeds and account transfer forms but never follow up to ensure clients actually submitted them. Other times, people acquire new assets after creating their trust and forget to add them.

Life gets busy. The paperwork sits on the kitchen counter for weeks. Calling the bank seems like a hassle. Recording a deed at the county clerk's office takes time. Gradually, months turn into years, and the trust remains empty or only partially funded.

Some people avoid funding because they worry about losing control or facing tax consequences. These concerns are usually unfounded for revocable living trusts. You maintain complete control over trust assets during your lifetime. You can buy, sell, or spend anything in the trust just as you did before. For tax purposes, the IRS ignores revocable living trusts, and you continue reporting all income on your personal tax return.

What Happens When Your Trust Is Not Funded?

An unfunded trust fails to achieve the primary purpose most people create them for, which is avoiding probate. Under Illinois law, specifically the Illinois Probate Act found at 755 ILCS 5/1-1, any property you own in your individual name at death must go through probate court before it can be distributed to your heirs.

Probate in Illinois typically takes at least six months to a year, even for simple estates. The court supervises the entire process. Your executor must file petitions, publish notices, pay court fees, and follow strict procedures. All of this becomes public record. Anyone can look up what you owned and who inherited your property.

The costs add up quickly. Executor fees, attorney fees, court costs, and publication expenses reduce the amount your family receives. While Illinois probate is less expensive than in some states, these costs are completely avoidable with a properly funded trust.

If you own property in multiple states, unfunded trusts create an even bigger problem. Your family will need to open separate probate proceedings in each state where you owned real estate. This multiplies the delays, expenses, and complications your family must deal with during an already difficult time.

Can You Add More Assets After Creating Your Trust?

Creating and funding your trust is not a one-time event. Whenever you acquire new property, you should transfer it into the trust. Buy a new house? Record a deed in the trust's name. Open a new bank account? Title it in the trust's name from the start. Inherit money? Deposit it into trust accounts.

Many people have pour-over wills that accompany their trusts. Under 760 ILCS 3/405, Illinois recognizes pour-over wills as valid. These wills state that any assets you still own individually at death should pour over into your trust through probate. While pour-over wills provide a safety net, they do not avoid probate. They simply ensure those assets eventually follow your trust's instructions after going through the court process.

Call a Yorkville, IL Wills & Trusts Lawyer Today

A living trust only works when it is properly funded. If you created a trust years ago but never funded it, or if you have acquired new assets since funding your trust, now is the time to address this issue.

At Gateville Law Firm, we offer free consultations and have over 20 years of experience helping Illinois families protect their legacies. We can review your current trust, identify unfunded assets, and help you complete the funding process. 

Do not let your careful planning go to waste because of unfunded assets. Call Gateville Law Firm at 630-780-1034 today to schedule your free consultation with our Kendall County estate planning attorney.