Trusts are important tools that provide flexibility, tax benefits, and other advantages for estate planning purposes or even during the grantor’s lifetime. As the benefits of creating a trust gain more attention, more people have begun utilizing as a part of their estate planning.
However, there are many trust options, and they are not one-size-fits-all.
An experienced trust attorney from Pierro, Connor & Strauss can advise New Yorkers from the greater Albany and NYC-metro area with all trust matters from creation and administration to litigation.
Benefits of setting up a trust
Depending on your goals, a trust can provide benefits to beneficiaries immediately or at the time of the grantor’s death. A person, association, corporation, board, governmental agency, or any other legal “person” may dispose of real and personal property by way of a trust under the New York Estates, Powers, and Trusts Law.
Some of the many reasons to create a trust include:
Avoiding probate. Unless the trust is a testamentary trust that is created upon the grantor’s death as part of an estate plan, the trust assets do not need to go through probate to be distributed. Avoiding probate helps reduce costs and keeps sensitive matters private rather than making financial details part of a public court record.
Reducing taxes. Certain trusts can reduce the trust maker’s taxable assets, though they may be subject to gift tax requirements. Annual transfers to the trust may also be made tax-free up to the exemption limit.
Control over property. The assets that the grantor places into a trust must be distributed according to the terms of the trust. This means that a grantor can place restrictions on how the assets are treated far into the future, during periods of disability, and even past their death.
Maintain flexibility. Some trusts can be amended and allow for flexibility. Others, however, cannot be changed, so it is important for grantors to choose the option that best reflects their intentions in creating the trust.
Not all trusts offer the same benefits. A New York estate planning lawyer can explain the pros and cons of each trust in any given situation.