A living trust can offer benefits to people from all walks of life – young and old, wealthy and those of modest means.  There are many types of trusts available to meet widely varying goals, but they must be crafted and maintained with care to achieve the desired results.

At Pierro, Connor & Strauss, a living trust lawyer can help determine whether a living trust is right for you. In many cases, a living trust is advantageous but in other cases, a living trust attorney will determine whether other estate planning tools better suit a client’s needs.

What is a living trust?

A living trust is a trust that is created and funded during the lifetime of the creator (also called the settlor or the grantor). This is in contrast to a testamentary trust, which is created according to instructions in the settlor’s will and therefore is not created or funded until their death.

A living trust can be either revocable or irrevocable. In order to avoid probate but retain flexibility, a revocable living trust (RLT) paired with a properly drafted will is a powerful tool. An irrevocable living trust can allow the creator to provide for a beneficiary without jeopardizing government benefits, such as in a Special Needs Trust (SNT) or Medicaid Asset Protection Trust (MAPT).

A revocable trust can be modified, or even dissolved, if the creator so chooses. When paired with a carefully drafted will, known as a pour-over will, the grantor may be able to make changes to asset distribution plans without the formality of changing the will and in a way that bypasses the probate process. However, a revocable trust does not protect assets from creditors or necessarily limit tax exposure because the grantor can dissolve the trust and reach the assets at any time.

An irrevocable trust is more firmly fixed. Once created, it cannot be dissolved, and allowable changes are minimal. However, because ownership rights over the assets are separate from the rights of the settlor and the beneficiary, a buffer is formed. The assets are not counted among the assets of either party, thereby reducing taxes, protecting assets from creditors, and keeping the trust property from being counted against the beneficiary when determining eligibility for government programs.

Should you consider creating a living trust?

Whether to create a living trust is a very personal decision. No two people are in exactly the same situation. A living trust attorney will help you customize your plan to your needs and goals.

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If you have assets that would normally go through probate, such as a bank account and a home, a living trust can eliminate the need for validating a will in New York Surrogate’s Court. Especially in New York City, Surrogate’s Court proceedings face long delays during which your family would not have access to your assets. There can also be significant court fees.

If there is conflict in the family, a Surrogate’s Court proceeding also provides an unwelcome opportunity for public litigation over the will. Many clients choose a living trust because it preserves privacy and reduces conflict down the road. By creating a living trust, the settlor has already made decisions about the distribution of their assets, and no public proceeding is required to administer the trust.

Additionally, creating a living trust protects you in the event of future incapacity. If the living trust is already in place before you experience an unexpected impairment that leaves you unable to make decisions, the pre-planning and direction you have given to the trustee can make it unnecessary for your loved ones to go to court and appoint a guardian.

If your current or future assets are sufficient to be subject to estate taxes, living trusts are essential tools for tax planning purposes.

Furthermore, if you or a loved one who receive or may one day need to receive government benefits, an irrevocable living trust can help protect assets while maintaining the beneficiary’s eligibility for benefits.

The best way to find out whether a living trust is right for you is to speak with an experienced living trust lawyer.

Get advice from an experienced living trust lawyer

As the benefits of living trusts become more widely known, they are becoming more common. Unfortunately, there are many companies offering one-size-fits-all and do-it-yourself kits that are in essence data-harvesting schemes and so-called “trust mills.” These “plans” do not serve your specific needs and coax individuals into constantly moving assets while claiming a commission at each step.

A trustworthy will and trust lawyer is a far better estate planning resource. At Pierro, Connor & Strauss, our reputation is based on our years of dedication to ethical and individualized legal representation throughout the state of New York. Call us today to speak with an estate planning lawyer to find out what kind of trust is right for you. We serve clients in Albany and the surrounding region, including Schenectady, Troy, Hudson and Saratoga, as well as Long Island and New York City.

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Contact us today for a FREE consultation and we’ll be happy to help take the worry out of tomorrow so you can live today.

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