At Merlino & Gonzalez, our accomplished estate planning attorneys help clients throughout Staten Island and New Jersey create living (revocable) trusts to serve a number of important purposes. One of the first things we often have to clarify is that living trusts can be very useful for those with moderate assets as well as for those with high-net-worth estates. We can then move on to discuss financial and personal goals and how establishing living trusts can help you realize them.
Our practice is client-centered and we always take the time to understand your unique circumstances so we can customize our advice and guidance to meet your specific needs. Contact us today to find out how smoothly and successfully living trusts can be incorporated into the estate planning process. You can rely on us to provide you with the efficient service and personal attention you deserve.
Revocable Trusts Can Avoid Probate
One of the primary reasons many clients choose to create a revocable trust is that it will enable them to avoid probate. Probate, which is the validation of a will by the courts, most often is not the bugaboo it is perceived to be. In New Jersey, it is particularly streamlined. Nonetheless, for those with substantial wealth or complicated assets, (such as multiple properties, some of which are outside of the state or even the country), probate can be a long, drawn-out process.
Probate may therefore delay the time it takes your family members to receive their inheritance. In addition, it can be expensive, diminishing the value of your estate. Also, while wills are a matter of public record, trusts are a private matter, and privacy may be a priority for you.
The reason a revocable trust can help to avoid probate is that the trust legally takes ownership of the property it is funded with, so that property is no longer part of the trustor’s (settlor’s) estate, though they can continue managing the trust throughout their lifetime. Once the trustor dies, the trust becomes irrevocable and the funds will be distributed to the named beneficiary by the designated trustee in the manner authorized.
There is even a way to handle the eventuality that the trustor has failed to transfer some property that could be subject to probate. Our attorneys can help you create a “pour-over” will to ensure that assets intended to be in the trust can pass through the will and be “poured” into the trust.
Living Trusts Offer Flexibility During Your Lifetime
Because a living trust (also known as an inter vivos trust) is revocable, you can modify it as you wish. As trustor, you can change the provisions of the trust, remove or add property, change the names of beneficiaries, or even (as the name states) revoke it altogether. In other words, although you no longer own the property in the trust, you can make decisions about it through a trust amendment and restatement and you can use it as if you still had title to it.
This ability to alter the terms of the trust can be invaluable if, for example, if you divorce and remarry and want to protect the rights of your children from the first marriage and/or want to include a new member of your blended family as another beneficiary of the trust.
Also, having named a trustee for these resources allows the person you have chosen to manage the trust funds if you retire or become incapacitated as well as at the time of your death.
Other Objectives Living Trusts Can Accomplish
Revocable trusts can be customized as you wish. For example, you can make stipulations concerning how and when funds will be distributed to your beneficiary: e.g. when they finish college, marry, or purchase a home. Also, you can add a pet trust to your living trust so that if you predecease your beloved pet it will be cared for with funds earmarked for that purpose.
What Revocable Trusts Cannot Do
There are limits to what a living trust can accomplish so you may want to create one or more irrevocable trusts as well. For instance, a living trust cannot protect your assets from certain creditors or assist you in avoiding income taxes.
There Are Good Reasons to Create Irrevocable Trusts as Well as Living Trusts
One of the advantages of working with a knowledgeable, skilled trusts attorney long-term is that you can explore estate planning options as your needs and goals change. In addition to a living trust, you may want to consider the benefits of one or more irrevocable trusts which may help you:
- Avoid or lessen estate taxes
- Protect your minor children from creditors
- Allow special needs loved ones to remain eligible for government benefits while receiving supplemental income as beneficiaries of a special needs trust
- Protect unstable relatives from going through their inheritance too quickly with a spendthrift trust
Contact Merlino & Gonzalez for Living Trusts You Can Trust
Our capable attorneys have the know-how to draft and execute even the most complicated living trusts without difficulty or stress. We are prepared to handle all of your other estate planning needs as well. Contact us now to experience the reassuring calm that comes from working with true professionals.