A Family Trust Lawyer Can Help Streamline Inheritance
Estate planning is about more than just a last will and testament. Many Arizona residents might not realize they have the power to customize their plans through a variety of options, with one of the most powerful being a trust. Don’t just picture wealthy businesses with board members discussing how to protect assets using convoluted legal documents — a family trust lawyer does exactly what the name suggests by creating a trust for regular families who simply want to protect what they value so they can pass it on. Trusts allow your heirs to receive their inheritance faster, more efficiently, and with more specificity than a simple will, and can be used in conjunction with other estate planning documents for a comprehensive, customized plan for after your passing.
So what is a trust? While there are a variety of trust options, at the most basic level, this document allows certain assets to be held “in trust” and then passed on to a named beneficiary. That means any property, funds, possessions, and other assets held in the trust avoid getting tangled up in probate proceedings.
Trusts Give You More Control
Trusts are an attractive option for families hoping to pass on property or possessions without being subjected to probate. When properly executed by a family trust lawyer, the assets within the trust can be swiftly transferred to beneficiaries when the initial grantors die. Unlike probate, the courts aren’t involved and all information is kept private.
However, there are additional benefits to establishing a trust. Because of the variety of trust options, you can set aside gifts for your chosen charities, dedicate funds for specific uses such as for your children’s education, and dictate how and when the assets will be distributed. This is where we get the idea of a “trust fund kid”; certain trusts provide funds for children but with limits on how much they receive or the age when the funds become available. The trust can also include several contingency plans, should chosen successor trustees or beneficiaries predecease the initial trustee.
How is a Trust Established?
The person who creates the trust is the grantor, transferring the assets into the trust and giving power over the trust to the trustee. Usually, the grantor is also the initial trustee, allowing that person to retain control of their assets while alive. Once the initial trustee or trustees die, power over the trust passes immediately to the successor trustees named in the document. Successor trustees then follow the directions in the trust to honor the wishes of the deceased, usually by disbursing the assets in the trust to the named beneficiaries. A trust administration lawyer can assist in the distribution process.
There are several kinds of trusts available to Arizona families, which is both a blessing and a potential cause for choice overload. Luckily, the family trust lawyers at Dyer Bregman Ferris Wong & Carter, PLLC can give your case personalized attention to determine which trust is right for your situation. Our estate planning attorneys can also customize your other documents to work together with the trust, covering all your bases in the event of your death or incapacity.
The broadest trust categories to keep in mind are revocable and irrevocable trusts.
Also called a “living trust”, revocable trusts are among the most flexible trust options because they can be changed. As long as the initial grantor is alive, assets can be added or removed from the trust, allowing the document to better reflect the changes that inevitably occur as life goes on. Revocable trusts can hold real estate, bank accounts, investments, bonds, and personal possessions like antiques, family heirlooms, valuable jewelry, etc.
In addition to swapping out assets within the trust, a living trust also allows grantors to change successors and beneficiaries. Best of all, grantors can still use and access the assets held in trust for their lifetime. It is only when all initial trustees pass on that the trust becomes irrevocable.
As the name suggests, these trusts cannot easily be changed once put into action unless you’re attorney has provided the flexibility for changes to be made . Generally, property and assets held in the trust remain there, inaccessible until the terms of the trust are met. The grantors cannot remove assets, change successors or beneficiaries, or make use of the assets held in trust. Revocable trusts turn into irrevocable ones upon the death of the initial grantors
Irrevocable trusts sound intractable, but that’s the point. They’re often used to limit access to these assets until, a child reaches adulthood and can make responsible use of them and for a variety of income and estate tax purposes.