These Are The Perks of Creating a Trust!

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Services for Real Estate Pros

 

 

Regarding estate planning, several people choose the standard option of a will to pass on their assets after death. However, another option, known as a trust, helps in planning your estate and distribution. Consult San Antonio trusts planning attorney and discuss all your options for estate planning.

 

A trust is a kind of legal contract. It is created by a legal attorney, along with a known trustee who ensures that all your property is being managed per your wishes. He provides it when you are alive as well as after death.

 

Benefits of adding trust in your estate planning. 

 

1. Helps in avoiding the process of probate.

 

All the assets managed by the will must pass through probate for verification and distribution. On the other hand, trust does not have to go through it. A will gets public, but the terms and conditions stay private. For establishing trust, there is a requirement for only an attorney and a trustee. A stipulation is possible in your will regarding creating trust after your death. In this case, your assets will be passed through probate and then converted to trust.

 

A trust helps to ensure the financial well-being of your loved ones if you pass away or become incapable of helping them for any reason.

 

2. It provides tax benefits.

 

 Trusts are of two types: revocable and irrevocable. It means that amendments after creation are possible in some kinds of trusts, while in others, it is not. A revocable trust provides the option of making changes to it after signing. However, it may or may not lead to tax benefits. It entirely depends on its terms.

 

An irrevocable trust cannot be changed after the signing of an agreement. This is because the assets have already been transferred out of the estate, and there are transfers of tax benefits and irrevocable trusts.

 

Contributions made to the trust are subjected to gift tax requirements during the owner's lifetime. However, if they meet certain conditions, the assets in such a type of trust can be protected from estate taxes after your death.

 

Along with initial funding, you can also create an annual exclusion gift in the irrevocable trust every year without paying additional gift tax on your contribution.

 

3. Trusts offer assistance during illness or disability, not just in the case of death.

 

Wills are valid only when the person is deceased. However, a revocable trust created when the decedent is alive can help the decedent's family in case of illness or inability to manage assets. If that takes place, the trustee is allowed to make distributions on behalf of the decedent. He can pay bills and file tax returns for the deceased person.

 

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