Austin Trusts Attorneys Developing Custom-Tailored Plans for Clients Throughout Texas
While there is no one-size-fits-all method for creating the finest estate plan in Texas, many estate plans use a combination of tactics and legal documentation to secure their estate’s future success and safety. Trusts are one of the most adaptable and useful instruments you may employ during estate planning. Out of all of those methods and legal documents you can use in an estate plan, trusts tend to be the most versatile. While trusts are more difficult to comprehend than wills, it may be worthwhile to consider establishing one for your estate.
Our law firm wants to remove the hassles and difficulties of understanding what goes in an effective trust. We can help you by going over all of your estate planning possibilities with you and explaining how each kind of trust may benefit you and your family. Call us now at 512-400-4430 to learn more about our Austin trusts attorneys and how we can assist you in establishing a trust specifically for you.
What is the Purpose of a Trust?
Trust in an estate plan is a legal document that can maintain privacy and reduce delays. Trusts and Wills do basically the same thing, which is to say that they both control the distribution of your estate after your death. Wills may cost less money to create, but they’re public documents and require court intervention. Trusts, on the other hand, are private documents that don’t require court intervention or public disclosure of your assets. Further, Trusts are better tax planning vehicles because you can take advantage of Disclaimer Trusts, Marital Deduction Trusts, or other types of Sub-Trusts. Also, Trusts can be incredibly beneficial if there’s a company or LLC in order to reduce time delays in managing said business because if you’re waiting on court approval, then there may be literally no one in control of the said company until the court appoints the executor, and that can have a serious negative impact on many businesses and for some, it can eliminate the entire value of the business.
Inside of a revocable living trust, you can create Sub-Trusts that will pop up in the future once one or both trustees have passed away. These sub-trusts are typically irrevocable and often contain liability protection. For example, a sub-trust could protect the assets from creditors of the surviving spouse, or protect the assets held for the benefit of a child or young adult from the child’s creditors such as a personal injury plaintiff or from a divorcing spouse.
If you plan to leave an inheritance to a young grandchild, for example, you may want to postpone giving them their inheritance until they reach a particular age. These conditions might be included in trusts to help make sure that your money passes to the right people at the right time, rather than to the wrong people, or even to the right people, but at the wrong time.
You may be able to reduce the taxes owed by your estate by putting all of your assets in a trust. Trusts can utilize sub-trusts such as a Disclaimer Trust, for example, which can be used to help take advantage of a deceased person’s unified estate tax credit. Without the help of a Disclaimer Trust, for example, you’re hoping that portability remains in effect, but there is no guarantee that portability will still exist in the future. Further, if the unified credit amount for estate taxes is likely to get reduced in your estimation, then you may want to lock in the deceased’s person’s more attractive exemption amount. Without the proper trust setup, many people will end up paying more in estate taxes.
A trustee is in charge of managing your trust. While you are alive, you can be the designated trustee of your estate. However, as a contingency, you should also select a successor trustee that takes over for you after you die. Some people choose a friend or family member, but many choose a corporate trustee. A corporate trustee may be a better choice for many people because that’s their job, they know how to do the job because they’ve done it tons of times before, and, in our opinion, your money is typically safer from theft with a corporate trustee. Compare that to a personal trustee, say cousin Bob, who is now managing your multi-million dollar estate, but Bob is not good with managing money, nor filing tax returns, and there’s a chance that Bob simply takes the money and runs away to a tropical island with your life savings.
Speak with one of our Austin Estate Planning Attorneys now to learn more about the advantages of establishing a trust as part of your estate plan.
What Types of Trusts Can a Lawyer Help Me Set Up?
There are many types of trusts available. It is our experience that many people have the wrong idea about which trust they want. For example, we get lots of calls from people who tell us that they want an irrevocable trust, but after we have a conversation they realize that they want a revocable trust instead of an irrevocable trust. There are many different types of trusts and they each serve specific purposes. Revocable living trusts can be revoked, they can control the disposition of your assets, they can provide for you if you’re incapacitated, and they can utilize sub-trusts for distribution protection, estate tax minimization, and/or creditor protection. Irrevocable Trusts are often used to shelter assets from taxes and/or creditors, but they’re irrevocable which means that they typically cannot be revoked or changed. Marital Deduction Trusts are sub-trusts inside of a living trust that can help protect the deceased person’s estate from higher taxes and/or from being distributed to the wrong person, and they can be incredibly useful for blended families. Disclaimer Trusts are sub-trusts inside of a living trust that can help protect the deceased person’s estate from higher taxes and/or from creditors of the surviving spouse.
It can be hard to choose the right trust for you with so many different types of trusts to select from, especially if you don’t know where to begin. Our team of trusts and estate planning lawyers can explain what each form of trust may accomplish for you and your family and how they may be able to benefit you.
How Important is Having a Trust?
It depends. It may not be important or beneficial to you, or it may be incredibly important and beneficial to you. Many people end up choosing a revocable living trust over a traditional Will if they desire one or more of the following:
- Avoid unnecessary court delays
- Financial management if incapacitated
- Creditor protection for surviving spouse or other beneficiaries
- Reduce potential estate taxes
- Member of an LLC, company, or business
- They own property in another state, especially an expensive state such as California
- Create a sub-trust for their beneficiaries to protect the money from immature decisions, substance abuse risks, and/or creditors of such beneficiary
We highly recommend that you speak with an Austin trusts lawyer to find out if a Trust is right for you, and if so, then what type of trust and sub-trusts may be right for you.
Is It Worth Having an Austin Trusts Lawyer Helping Me with My Estate Plan?
Choosing the right trust for you can be difficult with so many options to choose from. That’s why we’ve dedicated our lives to assisting people like you. We pay great attention to our client’s demands so that we can lead them down the correct path when it comes to establishing a successful trust for their estate plan. Call us at 512-400-4430 whenever it is convenient for you to start developing an estate plan that meets your needs. As a reminder, our life is like a vapor that appears for a little time and then vanishes away, so we encourage everyone to plan today before it’s too late. That’s exactly why we build an efficient and effective system that reduces the stress and cost of estate planning.