What Are the Benefits of a Living Trust?

 Posted on March 08, 2023 in Estate Planning and Administration

Estate planning is not a one-size-fits-all endeavor. Each person's individual situation and wishes must to be taken into account when constructing a plan that meets their needs and the needs of their loved ones. One of the most popular estate planning choices that may be useful to you is a living trust—a written agreement that designates how assets are distributed upon death or incapacitation. Living trusts can offer numerous advantages, including avoiding probate court, reducing estate taxes, and providing more control over the distribution of assets.

Assets Transferred with a Living Trust Do Not Have to Pass Through Probate

Probate is a long, often costly court process involved in settling a deceased person's estate. During this time, assets are frozen until the courts have sorted through them all and distributed them. Understandably, most people want to avoid putting their surviving loved ones through the probate process. Unlike assets transferred through a will, assets transferred through a living trust avoid probate for faster and simpler distribution.

Living Trusts May Help Reduce Estate Taxes

Estate taxes can be a considerable expense, but certain living trusts may help reduce them. You can set up a living trust as a revocable trust or an irrevocable trust. With an irrevocable trust, assets are transferred out of the grantor's estate into the trust, reducing the value of the estate and thus, the amount of taxes due upon death.

Revocable Living Trusts Allow for More Control Over Asset Distribution

With a revocable living trust, you can have more control over how your assets are distributed during your life and after your death. You can also specify that certain conditions be met before assets are dispersed. For example, you may require that a beneficiary finish college before they receive their inheritance. Additionally, if you become incapacitated, your designated trustee can manage the assets in the trust on your behalf.

A living trust is just one of many estate planning tools available to help ensure that assets are transferred according to your wishes upon death or incapacity.

Contact our Hood County Estate Planning Lawyers

At Cain & Kiel Law, our Tarrant County estate planning attorneys take the time to get to know our clients and their unique needs. We can explore all of your estate planning options and determine what type of trust or other estate planning instruments would be most beneficial to you and then draft the appropriate documents. Call our office today at 817-645-1717 for a confidential consultation to learn more about the services we offer.

Source:

https://www.investopedia.com/terms/l/living-trust.asp