Think of a trust as a box, a place where you put your assets before they are released to the people or organizations that you designate to eventually receive them. A trust is a legal entity and so are you. Because you and the trust are separate legal entities, anything you transfer from you to the trust becomes property of the trust. The trust then holds the property for your benefit, or for the benefit of those you designate.
A trust consists of five components:
A trust can be useful for:
Many clients establish a trust to avoid probate. A trust will not be effective in avoiding probate, however, if your assets are not placed into the trust. If any are missed, it may be necessary to probate the estate in order to transfer the few excluded assets. Also, titling all of the property in the name of the estate can be cumbersome and can become an issue whenever you buy or sell property. Residency issues also are a factor in choosing a living trust instead of a Will as many states will not allow non-residents to serve as the executor of an estate. They will, however, allow an out-of-state resident to serve as the trustee of a living trust.
A revocable or living trust does not provide any advantages over the use of a traditional will in saving estate taxes. Trusts can be established, however, that will minimize estate taxes and/or control the distribution of property beyond the life of the surviving spouse. For example, a credit shelter trust is set up to minimize estate taxes; a marital trust may be established to obtain estate tax advantages, provide for the surviving spouse while alive, and direct the disposition of the assets after the death of the surviving spouse.
We know that your estate is a reflection of years of hard work, careful planning and good decisions. That's why we dedicate considerable time to design a plan that is tailored to meet your unique needs and help ensure a secure future for those closest to you. We provide practical solutions to estate planning and asset protection concerns to accomplish our clients' wishes, including maintaining management and control of their estate, while at the same time avoiding probate, protecting family members, ensuring their financial privacy, obtaining peace of mind and avoiding unnecessary taxes. We understand that every estate, regardless of size, is important.