Myth 3: My trust will help reduce taxes.
Your revocable trust can provide many benefits to you and your future beneficiaries, but tax savings is not one of them. Because you can revoke or get rid of your trust at any time for any reason, the state and federal government treat you as though you still have 100% ownership of these assets.
Any account you set up in the name of your trust will have your social security number listed for reporting purposes. That is because you are still the owner and are responsible for the tax reporting on these assets. The same holds true when you die . . . any assets held in the trust may avoid the probate process, but they will be reported on any final income or estate tax returns. There is no tax savings from having a revocable trust.