- Grantor vs. Non-Grantor Trust: Key Differences
The key difference between a grantor trust and a non-grantor trust is how taxes are handled. In a grantor trust, the person who created the trust reports all trust income on their own tax return. In a non-grantor trust, the trust files its own return as a separate taxpayer, which can lead to higher tax… read more…
- What Happens to Property Left Out of a Trust?
When someone passes away and their property is not in a trust, these assets must typically go through probate. Probate is a court-supervised process that can delay distribution, increase costs and expose private matters to the public. A financial advisor can help manage your assets and guide you in making decisions that support your estate… read more…
- Does a Revocable Trust Become Irrevocable After Death?
A trust can be a valuable way to protect your estate, but there are many considerations to make when choosing the right type of trust for your needs. For example, does a revocable trust become irrevocable upon death? A revocable trust does generally become irrevocable upon the grantor’s death, meaning its terms are no longer… read more…
- Probate vs. Trust: How They Work and When to Use Each
When planning for the transfer of assets after death, two terms come up often: probate and trust. Probate is the court-supervised process of validating a will, paying debts and distributing assets to heirs. A trust is a legal arrangement that holds and manages assets for beneficiaries, which can allow them to bypass probate entirely. Choosing… read more…
- Can You Set up a Trust Without an Attorney?
With today’s rising costs, some people consider setting up a trust without an attorney. But while online tools or DIY templates can work for simple revocable living trusts, more complex estates could benefit from professional legal help. Doing this could help you avoid potential mistakes that might delay distributions or create legal disputes among beneficiaries.… read more…
- Trustee vs. Beneficiary vs. Grantor: Estate Planning Guide
When a trust is created, three distinct roles define how it functions: the grantor, the trustee and the beneficiary. The grantor sets up the trust and contributes the assets. The trustee manages those assets according to the trust’s terms. The beneficiary receives the benefits from the trust, either through income, principal or both. Understanding how… read more…
- Trust vs. Trust Fund: Definitions, Purposes, Key Differences
While the terms trust and trust fund are often used interchangeably, they represent different aspects of estate planning. A trust is a legal arrangement where one party gives another the right to hold and manage assets for a third party. It’s essentially the legal framework that establishes how assets will be handled. A trust fund,… read more…
- What Does It Mean to Be a “Trust Fund Baby”?
A “trust fund baby” is someone who receives money or assets from a trust that is set up by family. This often gives them financial support without needing to earn it themselves. While the term is sometimes used to suggest luxury or entitlement, it mainly means that the person benefits from a legal financial arrangement… read more…
- How to Know If You Have a Trust Fund: Tips and Steps
Discovering you might have a trust fund can be life-changing, but many potential beneficiaries remain unaware of their good fortune. If you suspect you have a trust fund waiting, there are several practical steps you can take to find out. From reviewing family documents and speaking with relatives to consulting financial institutions and legal professionals,… read more…
- What Rights Does a Trust Beneficiary Have?
When someone names you as a trust beneficiary, you receive certain legal protections and privileges. However, understanding a trust beneficiary’s exact rights can be confusing. Trusts are powerful estate planning tools allowing for the management and distribution of assets according to specific instructions. The level of control and information you receive depends on several factors.… read more…
- 5 Reasons Why You May Want to Set Up a Trust Fund
Contrary to popular belief, trust funds are not just for the ultra-wealthy. They are versatile financial instruments that can help individuals across various income levels achieve specific estate planning goals. So, why set up a trust fund? It can provide a number of benefits, such as minimizing estate taxes, protecting assets from creditors, providing for… read more…
- California Living Trust Laws: Things to Consider
California living trust laws govern how residents can create and manage trusts to hold their assets, potentially bypassing probate—a court-supervised process for transferring property after death. Understanding these laws can help residents determine who will control their assets, manage distributions to beneficiaries and preserve privacy. Trust creators, known as grantors, typically retain control over their… read more…
- How Does a Living Trust Work?
A living trust is an estate planning tool that can allow you to maintain control over your assets, specify how they should be distributed and even protect them from legal challenges or financial mismanagement. Unlike a will, which requires probate court proceedings, assets held in a living trust can be distributed efficiently and privately. Working… read more…
- Can a Living Trust Avoid Probate?
Unlike a will, a living trust does not go through probate, which can save time and reduce legal costs. This can help streamline the process of distributing assets to designated beneficiaries without delays or expenses. To use a living trust effectively as part of your estate plan you will need to understand how it works.… read more…
- How to Fund a Trust: Step-By-Step Guide
Funding a trust requires moving your assets into the trust’s name, which is necessary for the trust to operate effectively. The process for transferring assets varies depending on the type, such as real estate, bank accounts and investments. Some assets are easy to transfer, while others are more complex and may need professional help. A… read more…
- Living Trusts vs. Revocable Trusts
When it comes to planning your estate, knowing the differences between living and revocable trusts is important. Both options can offer you ways to manage and distribute your assets while avoiding probate. But, they have distinct features that may impact your financial and legal strategy. Choosing the right trust depends on your goals. These can… read more…
- How a Pour-Over Will Works With a Living Trust
A pour-over will is paired with a living trust to manage assets after death. It transfers any remaining assets into the trust instead of distributing them directly. This method prevents state laws from deciding how these assets are distributed. Although assets moved with a pour-over will may go through probate, they ultimately join the trust,… read more…
- Testamentary Trusts vs. Living Trusts
When planning your estate, you should understand different trust options available, such as testamentary trusts and living trusts. A testamentary trust is created through a will and only becomes active after the death of the person who made it. A living trust, on the other hand, is established during an individual’s lifetime and assists in… read more…
- How to Utilize a Living Trust for a House
A living trust is a legal document that helps you pass down your assets to your beneficiaries when you die. So, what is a living trust on a house? Putting your house in a living trust lets you transfer ownership if you are incapacitated or pass on. The property you transfer into a living trust… read more…
- Can There Be Two or More Trustees for My Living Trust?
An important estate planning decision that you could face when setting up a living trust is choosing a trustee or trustees to oversee it. Appointing multiple trustees can enhance the management of your trust by combining diverse skills and perspectives to make well-rounded decisions. However, having more than one trustee can also be complicated. Here’s… read more…
- Bypass Trusts vs. Marital Trusts
When it comes to building an estate plan, trusts are a common tool used to manage assets, minimize taxes and set things up for a smooth transfer of wealth. Two trusts you may come across in the estate planning process include bypass trusts and marital trusts, both of which can protect assets and provide financial… read more…
- What Is a Survivor’s Trust and How Does It Work?
A survivor’s trust is a type of trust that is used in estate planning as part of a joint trust arrangement. It is typically established between spouses and comes into play upon the death of the first spouse. This trust allows the surviving spouse to retain control over the assets in the trust. The trust… read more…
- Deferred Sales Trust: What It Is, Examples, Pros and Cons
A deferred sales trust (DST) is an advanced tax strategy that allows investors to delay capital gains taxes on the sale of assets that have significantly risen in value, such as real estate or businesses. By selling the asset to a trust, the seller can receive payments over time, spreading out tax liabilities and allowing… read more…
- When Does a Trust Avoid the Probate Process?
One of the most effective tools in the estate planning process is a trust, which can offer significant advantages—including the ability to bypass the often lengthy and costly probate process. Trusts, by design, allow for the direct transfer of assets to beneficiaries without the need for court intervention, provided they are properly funded and managed.… read more…
- Pros and Cons of a Family Trust
A family trust can provide a structured plan for distributing assets, avoiding probate and distributing timely inheritance for beneficiaries. It can also offer tax benefits by potentially lowering the estate’s tax burden. However, setting up a trust involves initial costs and ongoing administrative tasks. Here’s a breakdown of the advantages and drawbacks to help you… read more…