The main reason for a trust is the minimization of the taxes that your estate will have to pay the state and federal government on your passing, as well as providing additional benefits and control over your property through the use of a well-crafted trust. A trust is essentially the appointment of a person called the trustee, who manages the property that you have placed in that trust, through directions you have provided when drafting the trust. Another benefit of a trust is you completely can avoid probate court, saving thousands in legal fees and the uncertainty that your last will and testament may not have been executed properly and thus your wishes will not be followed in probate court. Since a trust is established prior to your death, the property that is within the trust is not considered part of your estate when you pass away and there is no need for your family to have indoor the cost and waiting associated with the probate of an estate in probate court.
The benefits of a trust greatly outweigh the cost of initially establishing the trust. Within a trust you have the ability to even control your wealth during your lifetime and still provide a plan for the distribution of your wealth after you pass. Trusts are also invaluable tools to be used when you have a number of children or you’ve been married more than one time. Depending on your state law, even a last will and testament cannot divide your property exactly the way you want, it takes the right type of trust in order to determine exactly how you want your property distributed to your loved ones or to an organization such as a charity. One of the most important benefits of a trust that most people never consider is that your heirs may have situations in their life that would simply be throwing your money away in the event that it simply passed to them through probate, such as; if they owe money to creditors or filing bankruptcy the money you leave them or the property you leave them can be taken. Also in the event if one of your heirs gets divorced shortly after obtaining your inheritance, your heirs ex-spouse could get a portion or all of the inheritance you leave your heir.
There are many different types of trusts that through the use of an experienced estate planning lawyer that you may utilize to plan for the distribution of your wealth or the protection of your wealth, depending on your particular circumstances. One very important form of trust will protect your assets and property in the event that you need to go into a nursing facility or a hospice facility or even long term medical care prior to your death. Many people do not realize that even though they have health insurance and Medicare, many times the cost of your nursing care and final medical care will come out of the real estate that you own at the time of your death. If you simply use a will, you provide no protection from the government taking your home and selling it due to your final medical expenses and nursing home expenses, a last will and testament cannot protect your family from this. So if you have a spouse you plan to leave your marital home to, if you have exuberant nursing care expenses and medical expenses prior to your death, the most likely result is the house will be sold to cover those medical expenses. A well-planned trust will protect your family from losing your real estate.
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