There are many things to consider when you begin estate planning. You will need to decide what type of estate plans you want to include, such as whether you want to include a trust or just a will. If you choose to include a trust, you will have to decide whether you want it to be an irrevocable trust or a revocable trust. There are benefits to each type of trust, so you should keep in mind your financial goals of what you wish to accomplish by creating a trust in order to make sure you make the best estate plan for your needs.
Whichever estate planning route you take, it is always a good idea to speak with an experienced estate planning attorney prior to getting started. The California estate planning attorneys at Galanti and Copenhaver are here to help. With many years of experience, the attorneys at Galanti and Copenhaver have successfully handled a wide range of estate planning matters. Contact our office today at 707-867-0787 to schedule a consultation to discuss setting up a trust or any other estate planning needs.
What is a Trust?
A trust is a way of managing and holding property, and one of the many forms of estate planning. With a trust, the creator, or grantor transfers property over to the designated trustee. The trustee then manages the property within the trust for the benefit of the beneficiaries.
Benefits of Creating a Trust
By creating a trust, you can take advantage of many different benefits. First, with a trust you can avoid probate. The probate process can be long-lasting and expensive, and it will also make your finances involved in probate public record. Creating a trust allows you to avoid probate and its many drawbacks.
If you have a beneficiary with a disability, you can create a special needs trust which will allow them to maintain any government benefits they were receiving for their disability. Even if the beneficiary was not receiving benefits, creating a special needs trust allows them the option to get government benefits if they need to in the future.
With a trust, you may be able to protect your assets from certain creditors. You may also be able to avoid some taxes on the assets or at least delay taxes. You also generally have more control over your assets with a trust than with a will.
The Parties Involved in a Trust
When creating your trust, one of the most important things to keep in mind is that you must choose your trustee and beneficiaries carefully. The trustee is the party who is responsible for the management of your trust. While setting up the trust, you will also be choosing the specific responsibilities for the trustee and you will designate someone as trustee. Since this person is responsible for managing your trust, you want to make sure it is a dependable and trustworthy person.
You also will need to choose your beneficiaries. The beneficiaries to the trust are the parties that benefit from it. You can designate individuals, such as family members, as beneficiaries, as well as charitable organizations. If you choose an irrevocable trust, you will need to choose the beneficiaries carefully, as the trust cannot be modified.
Choosing a Revocable Trust or an Irrevocable Trust
When creating a trust, there are two main options. You can choose to make a revocable trust or an irrevocable trust. While estate planning, it is important to keep in mind your goals so that you can create the type of trust that best suits your needs.
A revocable trust can be modified at any time by the grantor, so this is a good option if you believe you will need to make changes in the future. With an irrevocable trust, the trust takes ownership of the property in the trust.
One benefit to creating an irrevocable trust is that since the property is no longer owned by you, the grantor, the property will not be included in the total value of your property at the time of your death. This allows the beneficiaries of the trust to avoid paying significant sums in estate taxes. In addition, an irrevocable trust may allow you to protect the property from creditors, since you will no longer own the property upon the creation of the trust. The property within an irrevocable trust is owned by the trust.
For all of your estate planning needs, the attorneys at Galanti and Copenhaver are ready to assist you. Contact our office today to get started with your estate planning.