As you plan for your asset distribution after your death, you may want to consider creating a trust. Depending on the type of trust that you choose, these arrangements either allow you to continue to control your assets while you are alive and capable of doing so while providing for seamless administration of your estate in the event of your disability or when you pass away, or they allow other people to hold assets for you and can provide a range of benefits for your estate plan. However, working with a trusts lawyer is essential to creating a trust the right way.
What Is a Trust?
A trust is a legally binding agreement that allows a person or entity to hold and manage assets for a beneficiary. Creating a trust can ensure that your assets are in responsible hands, minimize your estate taxes, legally transfer property to another person without the involvement of the Court or having to go through the probate process, and accomplish many other goals.
A trust usually consists of at least three roles:
- Grantor: The person who establishes the trust
- Trustee: The person responsible for managing the assets in the trust
- Beneficiary: The person who receives the trust’s assets according to the requirements within the trust
In some cases, the grantor fulfills the role of the trustee and beneficiary until their death, at which time the person designated as successor trustee takes over responsibility for administering the trust.
Trustees hold a range of responsibilities, such as administering the trust, avoiding conflicts of interest, dealing impartially with beneficiaries, and preserving the trust property. As a result, you should ensure that the person you choose as trustee is trustworthy and capable of fulfilling this role.
Common Types of Trusts
Before you create a trust, you must determine, with the advice and counsel of an experienced estate planning attorney, the right type of trust for your needs. Here are the three kinds of trusts we most frequently help clients with in Central Virginia:
- Revocable trust: A trust you create during your lifetime that allows you to maintain control over the assets within the trust and amend the trust rules at any time;
- Irrevocable trust: A trust that cannot be easily amended and that legally owns the assets within it but that provides asset protection if it is drafted and administered property;
- Special needs trust: A trust that holds assets for a minor or individual with special needs so that they can benefit from the assets in the trust while maintaining their eligibility for government benefits such as Medicaid and SSI.
Our law firm can help you determine the right type of trust for your estate planning needs.
Benefits of Trusts for Estate Planning
Creating a trust can provide many benefits for your estate plan. Here are a few reasons our clients decide to set up trusts:
- Distributing your estate through a trust may help your loved ones avoid probate
- Trusts can provide tax benefits
- Trusts allow you to dictate specific parameters for the use of your assets
- Trusts can permit a loved one to manage your finances if you become incapacitated
- Trusts can allow you to pass assets to a vulnerable loved one while providing protection for them from exploitation
- Trusts can allow blended families to ensure that assets are protected for children from a prior union while still giving the surviving spouse access to funds for the care if they need them.
Why Hire a Trusts Lawyer?
If you’d like to set up a trust, you need the assistance of a qualified trust attorney. Your attorney can help you create and fund a trust that will make your goals for your spouse and your loved ones legally enforceable and allow for the efficient and private transfer of assets to your beneficiaries. Experienced trust attorneys can help you design a trust that works for your specific situation, plan to minimize conflict among beneficiaries, and provide legal assistance to the trustee.
Contact Our Experienced Trusts Lawyer in Central Virginia
If you’re considering setting up a trust, our estate attorney team can help. Contact our Commonwealth Life & Legacy Counsel team today at 434-589-2958, or in or near Powhatan at (804) 598-1348, to schedule your free consultation with our Central Virginia lawyers.