Trusts Lawyer Assisting Clients in Bedford and Throughout Texas
Trusts can often be beneficial ways to manage the assets in an estate. There are many different kinds of trust that accomplish different things. What type of trust would be best in your particular case will depend on your goals and on the details of your circumstances. Trusts may be used to transfer wealth to heirs, manage tax liability, take care of loved ones with special needs, make charitable contributions, and many other beneficial functions. Trusts may be funded upon the death of the grantor (the person setting up the trust) or during the grantor’s life.
Attorney Anita K. Cutrer has over 20 years of experience helping clients determine what types of trusts would be beneficial in their estate plans and doing the legal paperwork necessary to create the trust(s). Call our office today at 817-854-1651 to schedule a free consultation to discuss your estate planning options.
What is a Trust?
While there are many particular types of trusts that can be used for different purposes, in general, a trust is a financial instrument that serves as a kind of a “container” for the assets of an estate. Assets are removed from the ownership of the grantor and transferred into the ownership of the trust. A trustee then manages the assets in the trust for the benefit of the beneficiary or beneficiaries of the trust. This does not mean, however, that the grantor cannot access the assets. In certain kinds of trusts, the grantor may also be the trustee and the beneficiary, thus maintaining access to the assets, even after they are transferred into the trust.
What Are the Benefits of Trusts?
There are several different benefits of trusts, depending on the type. Special needs trusts, for example, can hold and manage assets for a loved one who is not able to manage them on their own. The special needs trust can also keep inheritances out of the ownership of the special needs person, which often means that they can maintain their eligibility for government benefits such as Medicaid, Medical Assistance, Social Security Disability, and other entitlements.
Another benefit of trusts is that they can allow your family to avoid the probate process after you pass away. Assets held in trust do not have to go through the often lengthy and expensive probate process. This does not necessarily mean that there will be no probate, as there may be assets that are not held in trust, but those assets that are held in a trust will not be subject to the probate process.
While Texas does not have an estate, inheritance, or gift tax, large estates over $12 million in value may still be subject to federal estate taxes. If the assets are held in trust, this can reduce the value of the estate and potentially avoid having to pay the federal estate tax.
A trust can also be sued to dictate terms for inheritance. For example, if you would like your heirs to get annual payments instead of a lump sum, or not receive their full inheritance until a certain age, for example, a trust can be used o accomplish those goals. Trusts can also limit the uses of inheritance finds—specifying that funds are to be used for education only, for example.
There are other benefits of trusts that can best be understood by consulting with an experienced trust attorney who can assess your situation, listen to your goals, and explain your options.
What is a Living Trust?
Basically, a living trust is any trust that is funded while you are alive. There are a few common kinds of living trusts that have specific goals and benefits:
- Revocable trust: A revocable trust allows an individual to maintain control of assets while they are still alive. In a revocable trust, the trust assets can be moved, and the trust has a relatively flexible structure. It can be changed or amended at any time and it can be revoked at any time. A revocable trust is an estate planning vehicle that offers privacy advantages and control over assets.
- Irrevocable trust: An irrevocable trust cannot be changed and cannot be revoked. Any assets included in an irrevocable trust cannot be accessed by creditors. An irrevocable trust can provide a shelter against lawsuits, and provides strong asset protection.
- Asset protection trust: This type of trust protects the trust holder’s assets from future attempts by creditors to recover an individual’s assets. Asset protection trusts can have a specific time limit, with all undistributed assets in the trust returned to the trust holder at the trust’s expiration.
- Charitable trust: Charitable trusts are established to benefit a particular charity or the grantor’s favorite cause. These trusts not only provide a vehicle to contribute to an individual’s favorite charities and causes, but they also may provide significant tax benefits for the trust holder.
There are other kinds of living trusts that may be beneficial in your particular circumstances. Consult a skilled estate planning and trusts attorney to determine what trust(s) would be best
Why Choose Anita K. Cutrer, Attorney at Law?
Anita K. Cutrer, Attorney at Law, has over 20 years of experience helping clients throughout Texas determine which trusts, if any, would be beneficial to include in their comprehensive estate plans.
Contact the office of Anita K. Cutrer, Attorney at Law, at 817-854-1651 to discuss what trusts might be right for you.