Baldwin County Trust Lawyer
When you have assets, you have a need to both protect them and transfer them in an orderly manner to other parties. While you can use a will to transfer your assets, there are a number of potential risks if you don’t protect your assets using a trust.
First, if you face a long illness before your death, you may exhaust your assets due to the high cost of long-term care and nursing homes. Second, after your death, your estate may need to go through the probate process, which can cost your family time and money. At The Law Office of Brenton C. McWilliams, we help you create trusts so you can distribute your assets to your chosen beneficiaries and allow them to avoid the lengthy probate process after your death.
Trusts Can Help Your Family Avoid Probate
One way to effectuate your wishes while possibly protecting your assets is to establish one of a number of types of trusts. Trusts can go into effect either while you are alive or after you die, and they can help your family avoid the probate process after your death.
In any trust, there are three parties that matter:
- The grantor or settlor is the person who establishes the trust and moves their assets into it
- The trustee is the person who is tasked with the responsibility of managing the trust
- The beneficiary is the person who receives assets from the trust
It is called a trust in part because you are trusting someone else to manage and make decisions about your assets and property. In that regard, the trustee plays a very important legal role. You must choose someone with whom you have confidence, and you will know that they have both the capability and the integrity to do the right thing in their trustee role.
Different Types of Trusts That Can Benefit Your Estate
There are numerous types of trusts that can protect your estate and help your family avoid the probate process after you are gone. The four main types of trusts include:
- Living trust – This type of trust is created while you are still alive for the purpose of transferring assets to beneficiaries once you die
- Testamentary trust – This trust is created after you die by the terms of your will
- Revocable trust – You have the power to make changes to the trust during your lifetime. In the end, you have the ultimate control over the assets. Revocable trusts are not enough to be considered moving the assets out of your name for purposes of asset protection and Medicaid trusts.
- Irrevocable Trust – This type of trust is not changeable once it is executed. Here, the intention is usually to treat the property as if you have successfully and permanently moved the assets out of your name. An irrevocable trust may serve to protect your assets because they are legally no longer yours. They become the property of the trust. This can help in the Medicaid planning process, as it creates a path toward allowing you to be financially eligible for long-term care coverage.
Use a Trust to Protect Your Assets and Avoid Probate
Among these categories of trusts, there are numerous subcategories. Your family may use a trust for a number of reasons, including:
- To help your estate assets stay out of probate
- To preserve your assets for future generations
- To specifically provide for certain loved ones with needs
- To provide to a charity of your choice
- To help manage or minimize your family’s tax obligations
Why You Need an Estate Planning Attorney in Baldwin County
You will need an experienced estate planning attorney to help you decide which trust is appropriate for you and how to establish it. You cannot afford to make any mistakes, especially when you are dealing with an irrevocable trust.
Your trust lawyer will handle the details of the trust and execute all the necessary legal documents. You should not attempt to handle anything this complex on your own. You may make a costly mistake, and the trust may not end up being effective for your estate plan needs.
The trusted estate lawyers at The Law Office of Brenton C. McWilliams have both the knowledge and experience necessary to work with you on all of your estate planning needs, including helping you establish the types of trusts you need to protect your estate. For legal services regarding trusts and probate law, schedule a consultation with a qualified estate lawyer at our office today.
Trust & Probate Administration FAQs
How does a trust keep my estate out of probate?
Since the assets belong to the trust, not the individual, there is no need for a legal probate process to transfer them. Instead, assets are able to be transferred to the beneficiaries of the trust by the successor trustee according to the the terms of the trust .
How are trusts used to avoid taxes?
Irrevocable trusts can be used to avoid some types of taxes. In estate administration, irrevocable trusts may not be part of the grantor’s taxable estate. Therefore, an irrevocable trust may allow assets to pass to beneficiaries after your death without being subject to estate tax.
Are trusts public record in Alabama?
Since trusts are not subject to the probate process, they do not become public record under Alabama descent and distribution laws or intestacy laws. Trusts are a great way to keep your assets and family matters private and avoid public scrutiny. Law firms focusing on estate planning and probate law can help make sure your trusts are established properly so your assets avoid probate.