According to financialplanning.com’s post “Should Estate Plans Rely on Trusts?,” people structure their estate plan to include trusts for a number of reasons. In some instances, the trust functions as a contingent beneficiary, usually when there are minor children involved, and the trust assigns a guardian for the children until they come of age. Assets held in trust are not subject to probate at death, which is useful if a person owns property in multiple states, thereby avoiding probate in each state.
Implementing a trust provides control for assets in the event of incapacity. A co-trustee or successor trustee will take over the management of the trust assets. Another nice thing about a trust is that it gives you maximum privacy, where a will is public record and open to all.
Trust language can be drafted to reduce or eliminate estate taxes, as well as to protect from divorce settlements and creditors. In addition, a trust can protect dependents with special needs. Ask your estate planning attorney about a special needs trust for your child with special needs—or about the other types of trusts that might benefit your circumstances.
An individual can use trusts in one of two ways. Some people will grant title assets to a trust while alive, and then the living trust terms will stipulate the distribution of trust assets at the grantor’s death. Other folks don’t have a standalone living trust; instead, they use a testamentary trust which is funded through a will.
Contact a qualified estate planning attorney to help you decide which way to go.
For more information visit my Wichita KS Estate Planning Attorney website
Reference: financialplanning.com (August 13, 2015)“Should Estate Plans Rely on Trusts?”