Trust-Based Estate Planning
If you create a Trust-based Estate Plan (as opposed to a Will-based plan) you will likely avoid thousands of dollars in Probate expenses, prevent multi-jurisdiction real-estate Probate problems, mitigate government interference, keep your information private, prevent delays in asset distribution, take advantage of beneficiary asset protection, and reduce family conflict.
A Trust-based Estate Plan helps you
- Manage your day-to-day affairs while you are healthy
- Manage and provide for your care if you become incapacitated
- Reduce taxes
- Protect assets and
- Safeguard your loved ones after you are gone.
Idaho Law Group can help you create a customized Trust-based Estate Plan that supports your goals.
The Most Common Type of Trust is a Revocable Living Trust
8 Things You Should Know About a Revocable Living Trust
1. Probate Avoidance
- Property that is passed through a Will must be directed by Court order through probate. Idaho’s Probate process: proves the validity of the Will, appoints a Personal Representative, and implements the Will’s directives. Probate can be prolonged and expensive.
- Probate requires mandatory notification to all beneficiaries of the Will and to those who would inherit if there were no Will. This process allows those not named in a Will the opportunity to challenge the validity of the Will.
- If you own real estate in more than one state, your estate must probate property in each state where property is owned. However, you can avoid multiple state probates if all your properties are placed into a Trust.
- A Trust does not require probate court intervention. Your Trust is administered entirely by the Trustee you name. Your Trust is your detailed set of instructions regarding how your estate is to be governed.
- A Trust keeps your estate affairs private because it is not probated. When a Will is probated, all information filed with the Court is public record including the inventory of all assets and their values.
- A Trust allows for efficient distribution of your assets. According to the American Bar Association, the average Probate takes 9 months. However, if difficulties arise, some Probates last years.
- A Trust designed by Idaho Law Group avoids the mandatory probate notification process and can reduce unnecessary conflict.
2. Remarriage Protections
- If you die before your spouse, there is the possibility that your surviving spouse will remarry. Most Estate Plans provide for a surviving spouse and then for children. However, many Estate Plans do not prevent the surviving spouse from changing the plan to favor the new spouse and new children.
- Every estate planning attorney has stories of a surviving spouse remarrying and disinheriting the original heirs. A Trust-based Estate Plan can include safeguards to ensure the original plan is honored.
3. Asset Protection
- Many Estate Plans leave inheritances exposed. If a beneficiary gets sued or gets divorced, the inheritance you intended for a child may instead go to a creditor or an ex-spouse. Idaho Law Group drafts plans that protect each of your beneficiaries from creditors, predators, and divorce.
- A Trust-based plan has the capability to protect assets for whomever you name as a beneficary. This is accomplished by building sub-trusts into your estate planning Trust.
- Each Trust can be structured to leave assets to beneficiaries in a protected sub-trust with as many or as few restrictions as you deem appropriate.
4. Tax Advantages
Trust-based estate planning provides flexible options to reduce or eliminate estate tax. Idaho Law Froup will counsel with you to choose the appropriate provisions for your circumstances.
5. Trustmaker Disability
If you are turning 65 today, you have nearly a 70% chance of needing some type of Long Term Care services in your remaining years. (U.S. Department of Health and Human Services). If you are no longer able to manage your own finances, it is essential to have disability provisions drafted into your Trust.
- Provide for aging parents.
- Instruct your Trustee how to care for you and your family.
- Instruct your Trustee how to manage your assets.
- Plan for proper management of your business.
- Avoid the need for Court imposed conservatorship.
6. Beneficiary’s Disability
Your beneficiaries may experience disabling injury or illness after you have created your Estate Plan. You can build a disability sub-trust into each Trust-based estate plan. Idaho Law Group can also design stand-alone “Special Needs” Trusts when appropriate. Special Needs Planning
The medical and financial needs of a disabled beneficiary often necessitate use of government programs for assistance. Use of disability planning in your Trust will allow your disabled beneficiary to:
- Qualify for Medicaid and other assistance quickly
- Preserve the beneficiary’s inheritance
- Supplement the needs of your beneficiary without loss of government benefits
- Avoid the need for Court imposed conservatorship
7. Incompetent Beneficiaries
When an adult beneficiary suffers from addictions, immaturity, or devastating life events, this beneficiary’s inheritance may be in jeopardy. Properly designed Trusts will not only protect assets “for” the beneficiary, but they can also protect assets “from” the beneficiary.
8. Young Beneficiaries
When you leave assets to a mature beneficiary, he or she may predecease you and those assets pass to a child too young to manage them. You should determine who should manage the assets and what age is appropriate for the beneficiary to manage their inherited assets.
Other Types of Trusts
These are generally used to protect assets for the next generation. Elder Law / Medicaid Planning
Make use of laws of certain states such as Nevada, Wyoming, and South Dakota to achieve asset protection while retaining rights to principal.
Most common estate planning tool for avoiding probate, maintaining privacy, and simplifying estate administration.
Make use of laws of foreign jurisdictions such as the Cook Islands, Nevis, and Belize to achieve asset protection while retaining rights to principal.
Trusts to maintain and grow family assets for multiple generations.
These are designed to assist those receiving government aid without disqualifying them from the aid they depend upon. Special Needs Trust Planning
Save money and avoid problems with a Trust-based Estate Plan!
We provide education and counseling to individuals and families so you can make informed choices with confidence.