A trust is a valuable legal tool that can have numerous benefits. To create a trust, a person, referred to as the “settlor” or grantor,” transfers assets into the trust to be managed by a trustee for the benefit of the trust beneficiaries. When putting an asset in trust, you are actually transferring ownership of the asset from you personally to the trust. Some trust benefits
The knowledgeable estate planning attorneys at the Law Firm of Merlino & Gonzalez are here to create an estate plan that maximizes the benefits for you and your family. With a thorough understanding of trust and estate law, our dedicated attorneys know how to use trusts and other estate planning tools to design an estate plan that secures a future you have always wanted for you and your loved ones.
Types of Trusts
There are several different types of trusts, each designed to bring particular benefits. For instance, a trust can be irrevocable or revocable. With a revocable trust, you manage your assets in the trust during your lifetime and distribute what remains after you pass away. Revocable means that you can change or terminate the trust during your lifetime as long as you are not incapacitated. If you become incapacitated, the trustee or successor trustee will continue to manage the trust assets which may avoid the need for a court to appoint a guardian to manage your assets. Another significant benefit of this type of trust is that you are able to avoid probate. This means there will be lower costs associated with administering your estate and also avoid time delays associated with going through probate court.
An irrevocable trust, as its name suggests, cannot be modified or terminated once established, with a few exceptions. This type of trust is exceptional for things like Medicaid Planning. You, the grantor of the trust, do not have access to, or control over, trust assets and, therefore, they are not available for paying things like nursing home costs. That means that the trust assets are protected from being depleted by the skyrocketing costs of nursing home care as they are tied up in the trust. Additionally, the trust assets will not be included in the Medicaid income calculation which means it helps you secure Medicaid coverage.
There are also several other types of trusts that become even more specific than the two broad categories of revocable and irrevocable trusts. A testamentary trust is one such trust. This trust generally appears in a person’s will. The trust is funded during probate proceedings. This means that assets of the estate are transferred to the trust. The title of the asset will transfer from the deceased to the name of the trust. The trustee is then charged with carrying out all of the trust terms. A testamentary trust has several disadvantages. It is funded during probate and so it does not avoid probate. Additionally, the testamentary trust is subject to public record as it goes through public court proceedings. However, with a testamentary trust, you get the benefit of judicial oversight. The trust is administered under the watchful eye of the judge and probate court and so the trustee will be hard pressed to ever deviate from the trust terms and conditions.
Another type of trust is the charitable trust. This is when the trust beneficiary is a 501(c)(3) organization. Some people go a different route if they want to leave trust assets to a charitable organization. You can establish a trust and leave the remainder of the trust assets to a named charity after the interests of the other beneficiaries have ended. For example, if the trust provided for the welfare of children until they reached 18 years old, once they turned 18, any remaining trust assets would then go to the named charity.
The different types of trusts and the things they can accomplish spread far and wide. Discuss your options with a qualified trusts and estates attorney to find out what would be best for you.
Estate Planning to Provide Security for You and Your Loved Ones.
The estate planning process is legally complex and, without a thorough understanding of the legal tools available, a highly effective estate plan is not possible. The knowledgeable attorneys at the Law Firm of Merlino & Gonzalez are here to create an estate plan fitted to the specific needs of you and your family. They have the experience and legal proficiency to design the most beneficial estate plan possible. Estate planning is too important to delay. Contact the Law Firm of Merlino & Gonzalez.