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Should You Establish a Trust?
In the State of Texas, if you choose to set up a trust, you will need the advice and assistance that a Waco trust attorney will provide.
If you own a home or a business in Texas, if you have any specific or special needs in your family, or if you own significant assets and properties, creating a trust may be the best tool to protect your assets and properties throughout your lifetime and preserve those assets and properties for your beneficiaries after you pass away.
Trusts – both irrevocable and revocable trusts – are popular estate planning tools. When you set up a trust, a Waco estate planning lawyer can help you consider your options and advise you regarding the best estate planning choices for you and your loved ones.
Why Establish a Trust?
Your trust is a legal and financial document that requires you to designate a trustee who will manage your assets and properties for your beneficiaries after your death. Your trust may specify precisely when and how your properties and assets are to be distributed to your beneficiaries.
The conditions and terms of your trust should be set forth carefully in the trust document, and that document should clearly indicate who will receive your assets and properties (and when). You may prepare a trust that is “revocable” or “irrevocable.”
What Action Can You Take to Avoid Probate?
With a properly created, and correctly maintained trust, your estate and your beneficiaries will avoid the probate process, and your assets and properties will be transferred sooner than they would if you had established only a will. Moreover, your beneficiaries will not have to deal with a probate court’s interference.
If you prepare only a will, in order for your assets to transfer after you pass away, your loved ones will need to begin some sort of probate process. This probate process may involve a probate court and long time delays.
For many, it is important to avoid probate. It can be lengthy and expensive, and in many cases. Probate proceedings go on the public record, so if privacy is a high priority for you, you may consider a trust and avoid the probate process.
Is a Revocable Trust Right for You?
If you prepare and properly use a revocable trust, your estate and your beneficiaries will avoid probate. You will stay in charge of the properties and assets in the trust for your lifetime, unless you become unable to manage the trust or choose to step aside so that the successor trustee of your choice can step to serve. A revocable trust may be amended, revised, or dissolved if your situation changes or if your wishes change.
You may designate yourself as the trustee of your revocable trust, but you also must designate a successor trustee to oversee your trust after your death or if you become incapacitated. Upon your death, your revocable trust immediately becomes an irrevocable trust.
If you have a revocable trust that has not been updated, or if your trust was prepared in another state, have a Waco estate planning lawyer review the trust to make sure that it is up-to-date, that it still meets your needs, and that it is compliant with this state’s financial requirements.
Is an Irrevocable Trust Right for You?
An irrevocable trust protects your properties and assets from estate taxes and the probate court, but an irrevocable trust cannot be dissolved or revised after it is established. When you move properties or assets into an irrevocable trust, you no longer own or control those properties and assets.
In some cases, however, setting up an irrevocable trust reduces the assets that are subject to estate taxes. There are no taxes on the income produced by an irrevocable trust’s assets, so long as that income is distributed in that year to the trust beneficiaries (although the distributions of such income may have tax consequences for the beneficiaries).
If the trust is properly created and administered, assets in your irrevocable trust are protected from legal judgments against you. Additionally, an irrevocable trust may instruct your trustee to halt temporarily or, in some cases, terminate distributions to a beneficiary who is named as a defendant in a lawsuit or files for bankruptcy.
Which Type of Trust Provides the Advantages You Need?
The flexibility of a revocable trust makes it a popular estate planning tool because a revocable trust lets you stay in charge of the assets you transfer into the trust. However, depending on your situation and your needs, the better option may be establishing an irrevocable trust.
A “specialty” trust is a revocable or irrevocable trust prepared for specific situations and needs. A Waco trust attorney can discuss specialty trusts with you and may advise you to prepare one of these:
- an asset protection trust
- a testamentary trust
- a special needs trust
- a marital trust
- a life insurance trust
- a charitable trust
What’s the Best Way to Protect Your Estate and Your Loved Ones?
If you’ve worked hard and saved, you should prepare a comprehensive estate plan that can protect your properties and assets, reduce your taxes, accomplish your wishes, and provide for your family after you’ve passed away.
Now is the time to schedule a meeting with an estate planning lawyer who can offer practical advice and help you start the estate planning process. And if you have an estate plan in place, it may be time to have that plan updated.
Why Should You Choose Rainey & Rainey?
You can learn more about trusts and estate planning by scheduling a consultation with Rainey & Rainey. We offer advice and insights based on our experience – more than two decades – helping clients prepare trusts and plan their estates.
After we discuss your finances, circumstances, and goals, Rainey & Rainey will recommend a comprehensive estate plan that protects your estate and offers security to your loved ones for years to come.
To find out more or to schedule your first consultation, call the offices of Rainey & Rainey at 254-457-508 (in or near Waco) or 512-357-7169 (in the Georgetown area). Across the State of Texas, we help clients and their families prepare for the future. Learn more, and call us today.
