A Nebraska living trust allows your heirs to receive your estate without the delay or interference of the court. A will, on the other hand, must go through probate before your estate can be distributed. However, it’s important to understand that a Nebraska living trust isn’t for everyone. Read on to find out who it does and doesn’t make sense for. For more help with your estate planning, consider working with a financial advisor who can make sure you make the right decisions to help you achieve your goals.
How to Create a Living Trust in Nebraska
Creating a living trust in any state is pretty similar but there can be a few different laws and regulations that you need to be aware of, depending on where you live. To create a living trust in Nebraska, use the following checklist:
- Choose the type of trust: Most people prefer revocable living trusts (as opposed to irrevocable ones), because they can maintain control of their estate, move assets out – and cancel the entire trust if they wish. If you are married, you’ll likely want a joint trust, though if it’s a later marriage and you have separate assets, you may prefer two single trusts, instead.
- Pick assets: Decide which assets you want to put in the living trust and gather the relevant paperwork. These can include bank accounts, brokerage accounts and certificates of deposit (CDs).
- Choose a trustee: The trustee will manage the trust on your behalf. You can name yourself as the trustee, but you’ll also have to appoint a trustee successor to step in when you die.
- Create the trust document: You should consider completing the trust document with the help of an attorney but you can also use your own by using specific software.
- Sign: Sign the trust agreement in front of a notary public.
- Transfer assets: Move assets into your trust by retitling them. You can do this yourself, but it’s recommended that you do it with the help of a professional to make sure it’s done correctly.
What Is a Living Trust?
A living trust is a legal entity that holds certain monetary assets and physical property for the benefit of a third party or parties. It is called “living,” because it is created when you – the owner or grantor – are alive. People commonly designate themselves as trustee, but you can appoint anyone you trust to uphold his or her fiduciary duty to manage your assets according to your wishes.
The trust document states who your beneficiaries are, what they will get once you die and when. With a trust, you can provide for someone’s support or delay the distribution of assets until an heir reaches a certain age. It also provides more privacy than a will, since it will not become part of the public record.
How Much Does It Cost to Create a Living Trust in Nebraska?
The price of creating a trust largely depends on how you go about making one. If you use a lawyer, fees can easily run $1,000 or more, depending on the hourly or project rate. If you want to keep costs down, there are online programs that cost less than $100. The other expenses are related to transferring assets to the trust.
That said, a living trust is a legal document that requires preciseness. So using a qualified lawyer who is familiar with estate planning is highly recommended. Taking this route will help you avoid the many dangers of DIY estate planning.
Why Get a Living Trust in Nebraska?
The primary reason for setting up a living trust in Nebraska – or anywhere in the U.S. – is to enable your estate to avoid probate. Nebraska has adopted the Uniform Probate Code, so the court process of validating and enacting a will does not take as long as it does in other states. Still, it will generally take at least six to nine months for estates that are clear-cut and free of complicating factors like creditor claims. Probate also comes with attorney fees and court costs.
Who Should Get a Living Trust in Nebraska?
Living trusts are not just for the wealthy. Generally, they are helpful to people who want their heirs to receive their inheritance promptly and without the interference of the court. Trusts are especially good ideas for people who own property in multiple states or at least in one other state, which has not adopted the Uniform Probate Code.
That said, if your estate is small, a living trust is probably unnecessary. In Nebraska, there is a simplified process for estates worth less than $50,000.
Additionally, trusts are a good choice for people who want to provide for someone with special needs or who want to delay the distribution of their estate until heirs are, say, 30. (With wills, estates are distributed once probate concludes). A living trust is also recommended if you are spreading your wealth in an uneven way. (A living trust is harder to contest than a will.)
Living Trusts vs. Wills in Nebraska
Despite the advantages that a living trust provides, you should still create a will. A will allows you to distribute what you didn’t or couldn’t transfer into your trust. It also allows you to do such things as:
- Name an executor
- State your preference for guardians for minor children
- Specify how to pay off debts and taxes
The following chart highlights what a living trust and will offer:
Living Trusts vs. Wills
|Name a property beneficiary||Yes||Yes|
|Allows revisions to be made||Depends on type||Yes|
|Avoids probate court||Yes||No|
|Requires a notary||Yes||No|
|Name guardians for children||No||Yes|
|Name an executor||No||Yes|
Living Trusts and Taxes in Nebraska
At the federal level, the federal exemption for the estate tax (also called the death tax) is $11.4 million for individuals and $22.8 million for couples. So unless you have a very large estate, a living trust will have no impact on your estate tax. (That said, the exemptions, set by the Trump Tax Plan, are scheduled to expire in 2025, so it’s wise to keep an eye on them.)
The Bottom Line
Nebraska has enacted the Uniform Probate Code, so the court process there is not typically as long as it can be in other states. For estates smaller than $50,000, Nebraska has an even more simplified process. A living trust makes sense, though, if you have a large and complicated estate, if you want to provide for an heir or if you simply don’t want the court to interfere with the distribution of your property. For more help with your estate planning, consider hiring a qualified financial advisor.
Estate Planning Tips
- You may want to consider working with a financial advisor, especially if you have a large and complicated estate. An advisor can make sure you follow all the laws in the state while helping you accomplish your goals. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool It connects you with up to three local advisors – and provides you with their profiles of each, so you can compare their qualifications before deciding on one, get started now.
- A living trust or revocable trust is just one of the many types of trusts out there. You should look into all of these and discuss options with your attorney and financial advisor to determine which one is most appropriate for you. Check out the best financial advisors in Lincoln or the best financial advisors in Omaha.
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