Frequently Asked Questions

 

Frequently Asked Questions

Q. WHAT ARE THE BENEFITS OF A REVOCABLE LIVING TRUST
(And other estate planning documents)

A.   AVOIDS PROBATE. Probate is a process where the court supervises the transfer of assets from a decedent to the beneficiaries or heirs.

  •  Probating an estate takes time [usually at least one year].
  • The Probate Process is expensive.  Fees are. 2 – 4% of the gross estate (set by statute).  For example, if the value of your estate is $1,000,000, your estate will pay $46,000 in fees to your executor and  a probate attorney plus costs
  • Because documents must be filed with a court, your assets become a matter of public record.

A.  BENEFITS OF A REVOCABLE LIVING TRUST

  • Provide for distribution to minors. A trust can delay distribution to minor beneficiaries (or to people who just shouldn’t get a lump sum) until the minors are old enough and mature enough to inherit.
  • Control. Avoid disinheritance of children from a prior marriage upon the death of the surviving non-parent spouse.
  • Protect your children’s inheritance in a Generation Skipping Trust. It protects from creditors,from divorce, and from estate taxation upon your child’s death.
  • Special provisions: Protect disabled beneficiaries with a Special Needs Trusts), handle drug, alcohol or gambling problems, spendthrifts, etc.
  • Non U.S. Citizens; Do a QDOT trust so that non-citizen spouse will not pay estate taxes on first death.
  • Incapacity: Choose who will take over in the event of incapacity. Your successor trustee will step in and manage your assets if you become incapacitated.
  • Reduce estate taxation: Although we have no federal estate tax this year, it will return next year. An A/B trust for married couples can eliminate or substantially reduce estate taxes.
  • Choose who will make medical decisions if you can’t: Execute a Durable Power of Attorney for Health Care.
  • Avoid Conservatorship: Execute a Durable Power of Attorney for Asset Management. This, together with a Trust, names who you want to handle your assets for you if you become incapacitated. It also allows you to name who should be your conservator if a conservatorship is necessary.
  • Your family will be grateful that you have taken steps to protect them and help them through the difficult process of settling your estate when you pass away.
  • The main benefit of taking care of your estate planning is the peace of mind it brings.