How to Set Up a Living Trust in Arizona: Your Complete Step-by-Step Guide

It is not complicated, but it does require the right steps in the right order. Use this roadmap to set up, sign and fund your trust the smart way.

Step 1: Decide if you actually need a trust

Start with fit. If you own a home or your total estate is above Arizona’s small estate limits, a trust helps your family avoid court, delays and extra fees. As of June 30, 2025, Arizona’s affidavit limits rise to 200,000 dollars in personal property and 300,000 in real estate equity. Above those amounts, probate is likely without non probate transfers or a funded trust. See HB 2116 updating A.R.S. § 14-3971.

New to trusts? Read our plain English primer, Living Trusts Explained, and compare options in Trusts vs Wills. For the court process you are trying to avoid, see our Guide to Probate.

Step 2: Choose your trust type

Most families pick a revocable living trust. You keep full control while you are alive and competent, and the trust becomes locked at death. Married couples often use a joint trust. If you are weighing asset protection or tax planning, learn the differences in revocable vs irrevocable trusts.

Step 3: Select your key players

Successor trustee

Pick someone responsible, organized and available. Skill beats seniority.

Choose a person or a professional who can follow instructions, communicate well and keep records. If family dynamics are tricky, consider a professional or co trustees. For what the role looks like in practice, see our FAQ on successor trustee support.

Beneficiaries and backups

Write clear gifts and name alternates so the plan still works if life changes.

“Split equally among my three children” is clear. “Take care of the family” is not. Add contingent beneficiaries and backup trustees. Use ages, milestones or purposes if you want delayed or conditional distributions.

Step 4: Draft the legal documents

Work with an Arizona estate planning attorney so the language tracks state law and institutions accept your paperwork. A typical plan includes:

• Revocable living trust
• Pour over will
• Durable financial power of attorney
• Health care power of attorney and HIPAA release
• Living will or advance directive

Our overview of these documents lives here: Powers of Attorney and Wills Explained.

Step 5: Execute everything properly

Arizona signing rules, the short version

Different documents have different signing requirements. Get each one right.

• Wills: Follow Arizona execution rules for paper wills.
• Financial power of attorney: Notarization is required by statute.
• Health care documents: Arizona allows a notary or a qualified adult witness for a health care power of attorney.

For the trust instrument itself, Arizona law permits a short Certification of Trust you can present to banks and title companies instead of the full document. See A.R.S. § 14-11013.

Step 6: Fund your trust

Real estate

Update title now or record a beneficiary deed for transfer at death.

Use a deed into the trust if you want trustee control during life. If you prefer transfer at death, consider a beneficiary deed. See A.R.S. § 33-405. For practical steps, see our Step by Step Funding Guide and this FAQ on putting a house in a trust with a mortgage.

Bank and investment accounts

Either retitle to the trust or use transfer on death to the trust.

Ask each institution for its trust title or transfer on death process. Open new trust accounts if needed and move balances. Verify after changes post.

Life insurance and retirement

Usually leave retirement in your name and use beneficiary designations.

Do not retitle IRAs or 401 k accounts into the trust. Instead, consider naming your spouse first, then the trust as contingent if you want trustee managed distributions. Weigh trade offs in Trust as IRA or 401 k Beneficiary.

Business interests and personal property

Assign ownership and sign a simple personal property memorandum.

Transfer LLC units, corporate shares or partnership interests per the entity documents. Use a bill of sale or assignment for valuables and household goods.

Step 7: Update beneficiary designations

Confirm life insurance, annuities and any transfer on death or payable on death accounts. Coordinate with your attorney and tax advisor so beneficiary choices match your trust plan.

Step 8: Store and share safely

Keep originals in a fire resistant place. Tell your successor trustee where to find them. Keep digital copies. Give key institutions a Certification of Trust when they need proof.

Common mistakes to avoid

Forgetting to fund

A beautifully drafted but empty trust still leaves your family in probate.

Use our funding checklist and verify each asset was retitled or designated.

Choosing the wrong trustee

Capability and availability matter more than birth order.

Pick the person who will communicate, document and follow directions. Consider a professional if needed.

Being vague

Write specific, plain English instructions your trustee can follow.

Spell out ages, milestones, purposes or hold backs. Clarity prevents disputes and delays.

Ignoring tax implications

Revocable trusts do not change income taxes while you are alive. Choices after death can.

Coordinate with a tax professional on beneficiary designations, retirement distributions and timing of sales.

The bottom line

Setting up a living trust takes planning and a few signatures. It saves your family time, expense and stress later. Follow the steps, fund it fully and keep it current. If you want a deeper foundation before you start, read Living Trusts Explained and our Guide to Probate.