Wealthy families in the US create trusts to preserve privacy and prevent court-mandated probate. If you want to create a trust as a part of estate planning, you need to hire a trusts lawyer.
Trust and property inheritance laws are complex, and you need an experienced lawyer to make the best estate plan. There are hundreds of trust lawyers practicing in San Diego. This article guides you with a few questions you should ask a trust attorney before finalizing your estate plan.
What Property Can Be Held in a Living Trust?
Any asset, including real estate, securities, and cash, can be held in a living trust. However, state laws differ, and some states do not allow the inclusion of life insurance policies and retirement accounts in living trust. Attorneys mention the more assets you put in the trust, the more beneficial it will be.
Who Can Be the Trustee?
Any beneficiary, including the grantor’s child, spouse, sibling, or friend, can be the trustee. Many people name themselves trustees in revocable trusts to manage the assets during their lifetime.
Lawyers mention that you can even choose any corporation or non-related person as a trustee. If you name yourself as a trustee, you must also name a successor trustee who can manage the trust after your demise.
Can a Living Trust Avoid Probate and Estate Taxes?
Trust attorney mentions a revocable trust cannot avoid probate and estate taxes levied by the state and federal government. If you want to create a trust to avoid estate taxes, you must create a joint trust, also known as A-B trust. Experts mention a married couple creates an A-B trust to avoid estate transfer taxes. Living trusts are not required to go through probate; hence there are no probate taxes.
What are the Different Types of Trusts?
An estate planning lawyer mentions several types of trusts like Revocable, irrevocable, charitable, asset protection, tax by-pass, special needs, and many more.
What is the Difference Between Trust and Will?
A living trust is created to manage specific assets that you want to be managed during your lifetime and after your death. You have the option of including various assets in the trust. However, some states do not allow the inclusion of life insurance policies in the living trust.
On the other hand, they will provide a way to distribute all assets owned by you after your death. A will contains a list of instructions of what will happen to your assets after you die.
Is It Necessary to Create a Will After Creating Trust?
As mentioned earlier, not all assets can go into trusts. Hence, estate planning attorneys recommend their clients to create a will even after creating a trust. If any assets are left out in the trust document, the will can protect them and pave the way for their distribution as per your wish mentioned in the will. Having a will and trust ensures all your assets are protected.
How to Create Trust?
An attorney can help create trust, and you can have a functioning trust in a few weeks with the advocate’s help. To create a trust, you need to obtain the correct forms for creating a trust for your state.
Next, you need to fill these forms and sign them before a notary. A lawyer can help you write terms for trust and mention the trustee’s name as mandated by law. The lawyer will also guide you by transferring the assets’ ownership to the trust to make it functional.
To sum up, these are questions you need to ask a trust lawyer before finalizing an estate plan. Having a person with knowledge of laws guiding the creation of trust will make the process much easier and prevent any complications in executing your instructions after your demise.