Estate planning is a major concern for many Texas residents and others around the country. Often, the goal for most individuals is to develop a plan that will avoid probate court. A living trust may be a viable option that provides inheritance protection for beneficiaries.
Assets may be placed in a living trust during someone's lifetime, then transferred to designated beneficiaries after his or her death. This may be wise for those who have beneficiaries with special needs, drug or alcohol additions, turbulent marriages or questionable spending habits. The assets will be protected for the beneficiary when placed in the living trust. There are several issues to address when considering if a living trust is the right choice for an estate plan.
Living trusts should be funded properly to receive the benefits of the trust, such as avoiding probate court. A living trust is funded when assets are transferred into the trust and appropriate beneficiary designations are made. While estate taxes may be a concern for some, $5.49 million may be passed tax-free before a 40 percent federal tax is assessed on the remainder of an estate. In addition, a married couple can designate double the tax exemption amount if the living trust is structured properly.
A living trust is not necessarily dependent on the amount of assets someone has. Rather, it is based more upon a person's financial goals for the future. The cost to establish and maintain a trust is based on its complexity. However, it will be money well-spent compared to the potential costs of administering an estate plan.
Estate planning can be a complicated process for Texas residents. An experienced attorney can help someone understand all the options available. A knowledgeable estate planning lawyer will help clients develop the plans that offer peace of mind for the future by providing the best asset protection for their beneficiaries.
Source: geenbaypressgazette.com, "Common questions about a living trust", Carisa Giebel, June 29, 2017