Living trust attorneys at Clarity Legal Group can provide assistance in determining if a living trust is right for you and can help you with trust creation. Our attorneys also have significant experience updating and improving Living Trusts which having fallen out of sync with your goals, changes in the law, or changes in what you own. There are many advantages to living trusts which is why so many people use these estate planning tools. However, it is also important to understand the limitations so you do not create a living trust expecting protections that this trust does not provide.
Almost every adult would be well served by a Living Trust, but the differences in strategies, applications, and uses differ significantly from person to person. The best way to determine how a living trust might help you is to reach out to Clarity Legal Group for, well — Clarity. Our legal team will provide personalized advice on the types of tools you should use in your estate plan. If creating a trust is right for you, we will work with you to ensure you create a legally valid trust document which reflects your specific goals and intentions. We will help you get the peace of mind which comes from planning to ensure your wishes are respected, those you care about are protected, and that you leave the legacy of organizing you affairs. To find out more about how we can help, give us a call.
Pros of a Living Trust
Some of the advantages of a living trust include:
- Flexibility: When you create a living trust, you still retain a very high degree of control over the assets that you have transferred to the trust. You can change your trust as needed or even end the trust if it no longer makes sense for you or for your family. An irrevocable trust, by contrast, does not provide this flexibility.
- The timely transfer of assets: Investopedia indicates that the probate process can take around a year. If you do not want your wealth to be tied up in probate for this long of a time and you want assets to transfer quickly to heirs or beneficiaries, creating a living trust is a smart option. The assets held within the living trust can pass through the trust administration process, which is faster than the probate process.
- Avoiding probate: Avoidance of probate not only allows for assets held in trust to transfer more quickly, but it also provides more privacy and often reduced costs. More of your wealth can be passed on to heirs or beneficiaries and you won’t have to worry about all of your personal financial details becoming court record.
- Efficient management: The use of a trust results in the most efficient means of allowing someone else to manage many of your assets in the event of your incapacity and at death. A Living Trust can also be a particularly flexible vehicle for you to modify and maintain your plan after your establish the trust.
- Some protection for incapacity: When you’ve made a living trust and named a backup trustee, the backup trustee can take over management of trust assets in case of incapacity. This means your wealth held in trust is protected from being mismanaged while guardianship or conservatorship proceedings take place or if the court appoints a guardian without the skill to manage your wealth in the most effective way.
- Enhanced control over your legacy: There is a reduced chance that a living trust could be successfully contested, as compared with a last will and testament, because of your ongoing involvement with managing the living trust during your lifetime.
There may also be other benefits of a living trust specific to your situation. You should talk with living trust attorneys at Clarity Legal Group to find out if this type of trust is an estate planning tool that should be part of your plans.
Common Misconceptions about Living Trusts
While there really are no negatives to having a living trust and the trust has many important benefits, it is not a solution for every problem you and your family might face. There are some common misconceptions about living trusts. For example:
- A living trust won’t help avoid estate tax. Although assets that are held in the trust can pass outside of the probate process, the assets will still be considered to be part of the taxable estate which means your estate may need to pay taxes after your death. Estate tax is charged only on larger estates, with the rules established under the tax law changes at the end of 2017 allowing over $11 million to be passed to heirs or beneficiaries without triggering estate tax.
- A living trust won’t protect assets in case you require costly nursing home care. Assets held in the living trust will still count for purposes of determining eligibility for Medicaid, which means that you could be forced to impoverish yourself before your nursing home is paid for.
Getting Help from Living Trust Attorneys
The Living trust attorneys at Clarity Legal Group can help you understand and define the ways a living trust can be the centerpiece of a well considered estate plan for you and assist you with the trust creation process. Give us a call at 919-484-0012 or contact us online today to find out more.
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