Long Island Living Trusts Lawyers Helping Clients Keep Control of Their Assets
Also Serving: New York City
For individuals with significant assets, having a trust in place can provide great benefits both during their lives and after their passing. Depending on your goals, you can develop a trust that protects your assets from creditors, minimizes your tax burden, and helps your family avoid the complex and expensive probate process. There are many kinds of trusts available, so you should consult with a capable living trust attorney before taking any legal action.
Individuals considering a trust should speak with experienced estate planning attorneys who are knowledgeable about estate and trust law. At Davidov Law Group, our talented legal team is deeply familiar with the many types of trusts available for New York citizens. We can develop the perfect estate plan for your family, including a living trust that offers you and your heirs the right amount of flexibility and protection.
Please don’t go with a one-size-fits-all document, or you could end up lacking access to your assets when it matters most. You will do better to rely on a law firm that focuses on this specific legal area because you’ll get advice based on years of experience with the many forms of living trusts. Contact us today for a free consultation by calling (516) 253-1366.
What Are Trusts?
Trusts are estate planning documents that provide many benefits. They are a way of holding assets so you can control who receives the funds, when they are released, and how they are disbursed. Trusts may also provide tax protection and shield your family from probate if used correctly.
In a trust, there are three important roles:
- Grantor: The grantor is the trust creator or the person who initially places the assets into the trust.
- Trustee: The trustee manages and distributes the assets. They are someone the grantor trusts implicitly because of the fiduciary nature of the trusteeship.
- Beneficiary: Beneficiaries of the trust receive the funds from the trust in the time and manner the grantor indicates. In some trusts, the grantor may be a beneficiary. There is virtually no limit on who may benefit from the trust. The grantor could name family members such as children, parents, a spouse, grandchildren, and other extended relatives. They could also include friends, charities, and even pets as named beneficiaries!
Trust administration occurs at different times depending on the type of trust. With most living trusts, the grantor may be able to access the funds at any time, which is one of the main benefits of this kind of trust. The assets may be sold, invested, or gifted to someone else. However, if you have an irrevocable living trust, this would not be possible because an irrevocable trust cannot be accessed or changed.
For more information about setting up a living trust, please speak with a skilled living trust lawyer who can help advise you on the best course of action for you and your family.
What Do Living Trusts Do?
A living trust is an estate planning tool used to protect your assets following your death. Following the grantor’s death, the family of someone with a living trust can receive their inheritance without going through the probate process. However, living trusts do not offer protection from an estate or income taxes.
There are limits to what assets may be placed in a living trust. While many assets are acceptable, such as funds from a savings or bank account, real estate, vehicles, and other valuables, you cannot transfer retirement accounts, such as IRAs, into a living trust. The good news is that all the assets in the trust are protected from probate. So, unlike a will that becomes public knowledge, your loved ones will maintain their privacy during the distribution of their inheritance.
Finally, living trusts allow a trusted friend or family member to assume guardianship over your assets if you become incapacitated. To learn more about how living trusts work and to develop the best estate plan for your unique needs, reach out to Davidov Law Group today.
What Kinds of Living Trusts Are There?
When drafting a living trust, it is essential to understand your options so you can provide the best future for your loved ones after you pass away. Living trusts are a key component in many estate plans because they offer flexibility in how assets are held and protect your family if you die or are incapacitated.
Some common types of living trusts in New York are:
- Revocable living trust – In a revocable living trust, the grantor may access the funds whenever necessary. However, these trusts do not offer much protection from taxation or creditors. They do protect your family from the costly and time-consuming probate process.
- Irrevocable living trust – Irrevocable trusts may not be changed, and assets within them cannot be accessed easily other than according to the terms of the trust. They offer excellent protection from creditors and can help minimize your tax burden.
- Special needs trust – A special needs trust can provide a comfortable life for a loved one or for the grantor who has special needs. The trust funds do not affect the ability of the beneficiaries to receive government assistance such as social security and Medicaid.
- Spendthrift trust – In a spendthrift trust, the grantor may transfer property to a beneficiary who may not be capable of spending the money or caring for the trust property wisely, such as in the case of beneficiaries who are minors. Under the trust’s terms, the funds may be distributed in small amounts over a long period of time.
Are There Any Disadvantages of Using a Living Trust?
Living trusts can be a valuable part of your estate plan, but they have some downsides. For example, they can be costly to set up because of the complexity of creating such a unique document. However, sometimes the peace of mind that comes with having protection for your loved ones is worth the price.
A few other disadvantages to living trusts are:
- Living trusts do not offer a tax advantage regarding income taxes.
- Assets in a living trust are not protected from estate taxes.
- Depending on the type of trust, you may be unable to access your assets freely.
- You will need to manage your living trust, including hiring a lawyer to amend the trust as your family dynamics change. Changes requiring updates to the trust include the birth or death of family members, marriages, or divorces.
Should You Hire Our Living Trusts Attorneys?
Living trusts can be an excellent solution for families wanting to avoid the probate process. They can protect the privacy of your loved ones and provide a comfortable life following your death. When used along with a last will, these documents are a highly efficient way of preparing for the future.
When it is time to create your estate plan, please don’t hesitate to give us a call. We have worked with countless clients to create living wills that match their family’s needs and goals. We promise to listen compassionately to your concerns and craft the right documents to give you peace of mind about the future. Call today to schedule a consultation at (516) 253-1366.