A trust is an estate planning tool in which you allow a third party (called a trustee) to hold your assets on behalf of your beneficiaries. Several types exist.
What is a trust, and do you need one? These are good questions, but the answers depend on your goals for your estate.
Each kind of trust can help you meet a different goal, and you can set up as many as you need to protect your assets and your heirs. Some trusts can even be useful for small estates.
A trust is a legal arrangement that gives a person or business the authority to hold assets on your behalf. Depending on the type, a trust may also include instructions on what to do with the assets.
The person setting up the trust is the grantor (that’s you). The person or business managing the trust is the trustee. In many cases, you can be trustee while you’re alive. Lastly, the people or organizations getting assets from the trust are the beneficiaries.
Trusts offer several benefits to you and your heirs, especially if your estate is large.
Avoid probate. Probate can be lengthy and expensive, and skipping it may let your heirs get their inheritance faster and keep more of it.
Increase privacy. Probate is also a public process, so avoiding it can keep your estate private.
Lower estate taxes. Certain trusts may not be considered part of your taxable estate.
A trust can take one of two forms: revocable or irrevocable.
A revocable trust, also called a living trust, lets you stay in control while you’re alive. You can change the terms and even dissolve the trust at any time. Assets often pass to heirs outside of probate, but may still be considered taxable.
An irrevocable trust is set in stone once you sign the paperwork. You no longer own the assets, and you can’t change or dissolve the trust for any reason. It will avoid estate taxes, but beneficiaries may still have to pay income taxes on distributions.
Each type of trust offers different advantages.
A bypass or credit shelter trust provides income to a surviving spouse, but doesn’t become part of his or estate. When your spouse dies, any assets pass to your successor beneficiaries.
The generation-skipping trust distributes assets directly to your grandchildren, great-grandchildren, etc.
A special needs trust supports a person who is disabled or otherwise unable to support themselves.
Spendthrift trusts allow you to control your heirs’ spending. For example, you can set up a distribution schedule, or name specific expenses the trust will pay.
Other trust types include charitable remainder trusts, life insurance trusts, and even pet trusts.
What’s best for you depends on your goals—both for your estate, and your heirs. Remember, you can set up as many trusts as you need to meet your goals.
Before setting up your trust(s), you may want to get advice from an estate planning lawyer in your state. Laws governing trusts vary a lot by location.
Divorce No matter how enthusiastic you were about leaving all of your assets to your spouse, you would probably feel differently once that spouse has become your ex-spouse. If you’ve undergone a divorce in the State of Arizona, most divorce decrees revoke the prior estate plan the married couple once shared, effectively rendering the estate plan null and void. In fact, Arizona law even revokes any gifts you plan to leave to your ex-spouse’s relatives unless it is specifically addressed in a new estate plan It’s time to draw up an all-new estate plan. Death of Spouse Did you and your spouse prepare a joint trust, or individual trusts, to house assets as a means of avoiding the headaches of probate court? If so, be advised that a trust can cause certain headaches of its own where your estate planning is concerned. You’ll need to check the estate plan in questions carefully to determine what your obligations are for carrying out your spouse’s wishes. If someone other than you is the Successor Trustee, you need to have an attorney review the estate plan to confirm and clarify your rights as Beneficiary. Certain portions of an estate can become irrevocable by the death of a spouse, so you’ll to know where you stand. Changes in Real Property Ownership When an estate plan originally designed for two spouses ends up in the hands of a single spouse, either through divorce or through that spouse’s death, you need to revise your real property ownership information. Additionally, if you buy a new piece of real property, you must make certain that it is included in your estate plan. Also, if you sell a property within your estate plan, you will need to modify the plan to remove that property from your current estate plan. Death or Divorce of Agents The Agent in an estate plan is the individual you have assigned as the person of responsibility for specific aspects of your estate plan after you die, such as a POA (Power of Attorney) Agent plus a Health Care (Durable Power of Attorney) Agent. But if that Agent you’re counting on dies while you’re still alive or other factors make continuing of this person as Agent impractical, you need to make sure you assign a new Agent so your Power of Attorney doesn’t simply vanish into thin air. Have you designated co-Agents who are married to each other? If so, their divorce should trigger the need for you to revisit your estate plan. This situation can cause a great deal of confusion and conflict if both individuals are still named as Agents, when they might now have opposed interests or may not want to work with each other at all. You need to revise your estate plan to name one or the other as your Agent going forward — or assign a new Agent entirely. Moving Few life events can throw an estate plan into total disarray quite so quickly and decisively as a relocation. An in-state move may require only modifying the estate plan’s address information, or perhaps the creation of a new Beneficiary Deed. An interstate or international move, however, opens up a great many questions — from the disposition of your Arizona assets to the validity of your Arizona documents. Addressing the new change of location and circumstances with an attorney licensed to practice law at your new residence is essential for updating your state plan correctly
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Having a will is important in estate planning, but it should also be complemented by a trust. A trust will distribute assets automatically to your beneficiaries once you pass and can save time, money, and most importantly, stress from spending additional time going through probate. If you want to ensure your trust is set up correctly, call the Law Office of Inna Fershteyn & Associates for NY’s leading estate planning service. The Law Office of Inna Fershteyn & Associates has been providing many individuals with legal help for over 22 years. With high ratings and over 200 positive reviews and counting, hear first-hand from some of our very own clients as they discuss their experiences at our firm. If you have any questions or want to speak with an attorney today, visit or contact our office at: 1517 Voorhies Avenue 4th Floor Brooklyn, NY 11235 (718) 333-2394 https://brooklyntrustandwill.com/cont... For more information about our firm: https://BrooklynTrustAndWill.com/ Our practice areas include: Medicaid Fraud, HRA fraud, SNAP fraud, Wills and Trusts, Estate Planning, Elder Law, Guardianship, NY Will Probate, Fair Hearings Music from https://filmmusic.io "Easy Lemon" by Kevin MacLeod (https://incompetech.com) License: CC BY (http://creativecommons.org/licenses/b...)
Attorney Thomas B. Burton answers a reader question about whether her sister can claim compensation for serving as Trustee of her mother's trust.
A Revocable Trust A Revocable Trust, also known as a living trust, is one of the best estate-planning tools the attorneys at Jurado & Farshchian, P.L. can create for you. A revocable trust can be a great way to avoid probate and efficiently manage and protect your assets after your death, which is something for which your beneficiaries will be immensely thankful. Many benefits come with a Florida revocable trust, which other estate-planning documents in Florida, like a will, cannot offer. Avoiding Probate with a Revocable Trust As mentioned earlier, one of the main benefits of using a revocable trust is that, unlike a will, a revocable trust will allow your estate to avoid probate and be distributed directly to your beneficiaries. This instrument will help save thousands of dollars and hundreds of hours. As you probably know, probate is the legal process an individual’s estate goes through when he or she passes away owning assets in his or her name. Besides the high amounts of time and money required to complete probate, the big problem with this process is that the court that handles your case will have full control. With a revocable trust, you have total control over what happens to your assets when you are no longer around. Keeping Control with a Revocable Trust A revocable trust is “revocable” because you have the power to change, amend, alter, or revoke the trust altogether at any time. A Florida revocable trust is a document that instructs a trustee on how to distribute the assets when you pass away. Generally, you are the manager of your revocable trust while you are alive. However, if you are unable to manage your trust, you get to choose the person who will manage your assets for you, and a court will have no control over this decision. A revocable trust is similar to a will in many ways. However, unlike a will, revocable trust assets do not pass through probate; they pass from your name to the name of the revocable trust. In other words, you no longer own the assets; the trust owns the assets. When you create a revocable trust, you keep total control of any assets you transfer into it. Usually, when you create a trust, you are the trustee and the beneficiary, which means you can revoke or amend the trust at any time. However, we recommend that other trustees be named in a revocable trust. This additional step can be extremely helpful in the event you become incapacitated, as your co-trustee can continue to manage your trust. Managing a Florida Revocable Trust If you have a trust, once you pass away, your trustee will have the duty of administering your estate. Such overseeing occurs efficiently and privately. When an estate goes through probate, the process is public, expensive, and time-consuming, and the personal representative must follow strict guidelines. Therefore, you should consider transferring your assets into a revocable trust. When you pass away, any assets that are not in your revocable trust must go through Florida probate. Thus, we recommend using a Pour-Over Will in conjunction with your Revocable Trust. A pour-over will tells the Florida probate court to transfer your assets to your revocable trust when you pass away. Protecting Your Assets with an Asset Protection Trust A Florida revocable trust has many benefits. However, asset protection is not one of them. The assets you transfer into a revocable trust are unprotected from your creditors. If creditor files claims, your assets act as if they were owned by you and are exposed to creditors with valid claims. By using a Florida Asset Protection Trust in conjunction with your Revocable Trust. When used in combination, both documents contain provisions to protect your beneficiaries from your creditors after your death. This is something for which your beneficiaries will be immensely thankful.
Client review of Brooklyn's best estate planning lawyer. If you need estate planning done, then come to a professional attorney and receive the best Elder law and asset protection advice. Attorney Inna Fershteyn is NY’s top estate planning and asset protection firm. Inna Fershteyn has over 22 years of practice and has over 195 positive reviews each review addressing amazing client experience received in our law office. If you need an estate planning attorney in NY, contact our office at: 1517 Voorhies Avenue 4th Floor Brooklyn, NY 11235 (718) 333-2394 https://brooklyntrustandwill.com/cont... For more information about our firm: https://BrooklynTrustAndWill.com/ Our practice areas: Medicaid Fraud, HRA fraud, SNAP fraud, Wills and Trusts, Estate Planning, Elder Law, Guardianship, NY Will Probate, Fair Hearings Music from https://filmmusic.io "Perspectives" by Kevin MacLeod (https://incompetech.com) License: CC BY (http://creativecommons.org/licenses/b...)
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