Trust

A Trust is just an agreement between you (the grantor) and someone you trust (the trustee) to follow your directions as to how the property you give to the trustee (trust assets) will be used for the beneficiaries (who you also choose, such as children, or a spouse or even yourself).

Types of Trusts

Living Trust: A Living Trust is simply a Trust which you create during your life and you can transfer assets toit  during your life.  Assets transferred to your trust during your life can be used for your benefit.  Depending upon how you set up the trust, upon your death, the trustee can either distribute assets to those you have designated or can continue to hold the assets for the benefit of those you have designated.  The assets in the Trust are not included in your estate for probate purposes but are part of your taxable estate.

Testamentary Trust: A Testamentary Trust is a trust which is part of your will and only takes effect upon your death.  The assets are part of your estate for probate purposes and the Probate Court has oversight of the activities of the Trustee.

Credit Shelter Trust: A Credit Shelter Trust is a mechanism used by estate planning attorneys to help you take full advantage of the federal and state estate tax credits thereby reducing the amount of taxes paid out of your estate and increasing the amount of your estate which passes to your beneficiaries.

QTIP Trust: A QTIP trust is one which is for the benefit of a surviving spouse and allows the surviving spouse the benefit of receiving the income from the trust during the surviving spouse’s lifetime but allows you to name who will receive the remaining property upon the surviving spouse’s death.  These types of trusts are particularly useful for second marriages.

Special Needs Trust: For families with children with special needs, they know that if their children have assets over a certain amount (as determined from time to time by the government) their children cannot receive the necessary assistance they need from governmental programs.  Therefore we  can work with families to create a trust with the purpose of  providing financial assistance upon their death to their special needs children without disqualifying them for governmental assistance.

Irrevocable Life Insurance Trusts:Generally Life Insurance proceeds are included in your estate for estate tax purposes. So, large life insurance policies can result in unintended estate taxes.  In some circumstances, we can eliminate those estate taxes if the insurance policy is owned by a specific kind of trust.

Administering a Trust.

While the use of trusts are invaluable to estate planning, the role of a trustee can seem daunting.  The trustee is responsible for managing the assets in the trust, following the Grantor’s directions in the trust and treating the beneficiaries fairly, while keeping accurate financial records and filing the necessary tax returns.   We are available to assist Trustees in all of their duties.