There are many reasons why you may need a Living Trust and while some may be quite technical others are rather simply practical. A living trust is essentially a legal document which safeguards an individual’s personal and financial interests in case of incapability or when they die. In this way, a person will be provided with a final cash payout which they can use to pay off debts and which also decreases the burden of probate. A living trust also allows for the quick transfer of wealth from the trust upon death and allows for the direct ownership of assets. However, there are many different types of these trust so it is important that you know what type you are looking for.
Probably one of the most common reasons for needing a living trust is the fact that one or more of the beneficiaries may have a substantial amount of estate tax liability. This is where an attorney can help. If there has been no beneficiary death then the court can actually set up the trust document in order to prevent any inheritance tax from being paid out upon death. If you are setting up such a trust, an experienced attorney can be of enormous help in formulating a set of instructions that are designed to avoid or eliminate any potential inheritance tax liability. An experienced attorney can go through all of the necessary paperwork with you and ensure that everything is legally set up.
Another reason for an attorney to be hired is the protection of property that has not been distributed due to probate concerns. This is particularly the case with young people who are still under the age of majority and who do not yet have any properties of their own. An example might be a young couple who have been married for several years and have a teenage daughter. Without a living trust the courts could possibly force the couple to distribute their daughter’s property between them, which could mean that her inheritance would be shared among her siblings.
One more reason for an estate planning attorney being hired by someone who is setting up a living trust would be if they have become terminally ill and do not have access to legal advice. If this situation occurs then having a living trust set up will ensure that all assets are protected from creditors. With most individuals dying in their sleep, there will be no will or living trust in place, leaving creditors at a severe disadvantage when trying to collect debts from a family member who has passed away. If you have a will it may make it easier for you to protect your assets from your creditors, but it is always better to ensure that a living trust has been setup so that your beneficiaries will have legal recourse when it comes to repaying debts.
In addition to protecting assets it is also important to make sure that you protect yourself from any estate taxes when you setup a living trust. As the owner of any assets that are set up in this way, any future taxes on those assets will be passed onto your beneficiaries. An estate tax can significantly increase the amount of debt owed on any assets that you have, so it is always best to make sure you protect yourself from it. By using a living trust you can give yourself protection from estate taxes by building up protections on any future assets. Also, by naming your beneficiaries you will be able to pay any estate taxes that you may owe at any time without any problems.
Finally, if you have children you may want to consider getting a living trust created. There is no reason not to do so if you have a child who is about to have a child. A revocable trust can be used to ensure that your minor children do not have to pay taxes on anything when they are old enough to claim inheritance tax on their own. You will have to get an attorney to help you set it up, but if everything is done correctly you can rest assured that the IRS will not be knocking at your front door knocking you down to help with the tax burden. By using a living trust attorney you can rest easy knowing that your family’s future will be taken care of even when they are too young to do anything about it.
