Essex County Trusts Attorney

Securing Your Legacy, Protecting Your Future

If you’re interested in making sure your loved ones will be taken care of and you want to save the time and money associated with having to go through probate, creating a trust will work well for you. Trusts are a great tool to use to manage your assets while you’re alive and also set instructions for distribution of your assets after you pass away. Depending on the kind of trust you choose, you can meet many different goals, like minimizing estate taxes, donating to charity, or protecting a loved one who is unable to manage money.

Trusts are complex legal documents that must be prepared with precise wording. Because of this, working with a Massachusetts estate planning lawyer is the best way to create a trust that meets your specific needs. The Heritage Law Center has helped countless clients create detailed trusts to attain a variety of of goals.

Please don’t hesitate to reach out to our team to learn more about trusts today. Contact our law firm for a consultation by calling (617) 765-9307.

What is a Trust?

A trust holds legal title to property for the benefit of another person (“beneficiary”). The person who creates the trust (“the grantor”) chooses a a trustee (sometimes themselves) to manage the assets in order to protect them. Think of it like a box where you can hold your assets for your benefit during your lifetime, and thereafter for the benefit of another person.

The trustee has a fiduciary responsibility as they’re required to act legally and ethically in the best interest of the grantor and the beneficiaries. A trust can be used to distribute property before death, at death, or afterwards.

What Are the Main Benefits of Creating a Trust?

There are many different kinds of trusts you can choose from, all of which provide different benefits. Our attorney will use extensive knowledge to create a trust that meets your unique needs. Some trusts offer flexibility and control, while others offer asset protection and estate tax minimization.

A trust can grant you the following benefits:

• Privacy
• Avoiding probate
• Protection from taxation
• Provisions for children
• Provisions for family members with special needs or disabilities
• Protection of loved ones unable to manage their own money

During your consultation with our team, we’ll discuss your current financial situation and your goals for the future. We can then choose a trust that meets all your needs now and in the future.

What Are the Two Basic Types of Trusts?

Trusts are often divided into two types: revocable trusts and irrevocable trusts. Both kinds of trust offer benefits and drawbacks, and one may fit into your estate plan better than the other.

The differences between the two types of trusts include:

Revocable Trust

A revocable trust can be modified or revoked at any point during your lifetime. You can add assets, remove assets, or even revoke the trust entirely. You can maintain total control over the assets in a revocable trust.

However, because a revocable trust can be changed so easily, they don’t offer the same asset protection as irrevocable trusts. Revocable trusts are still counted toward your estate, and creditors can go after assets in a revocable trust.

Irrevocable Trust

An irrevocable trust can’t be modified or revoked once the trust has been established. Any assets in the trust are under the control of the trustee, who generally shouldn’t be the creator of the trust.

Because irrevocable trusts can’t be changed, they offer more asset protection. Assets in an irrevocable trust are seen as being owned by the trust. The assets are typically not counted toward the value of your estate, and the assets in an irrevocable trust are protected from creditors.

Each type of trust offers pros and cons. Our team can examine both types of trusts with you to help you decide which trust is right for you.

What Are the Most Common Types of Trusts?

There are many different kinds of trusts you can choose from, all with different financial implications. Our team will help you select a trust based on your estate plan.

The most common types of trusts include:

• Testamentary Trusts: These trusts are included in wills, so they don’t go into effect until you pass away. They can hold any assets as well as funds only available after your death, like life insurance proceeds.
• Special Needs Trusts: Designed to allocate money to individuals with special needs while allowing them to remain eligible for government benefits.
• Charitable Trusts: Created to donate money to charity while either generating income for you or other beneficiaries or giving the remainder amount to family members or other beneficiaries.
• Bypass Trusts: Also called married A/B trusts, these trusts allow spouses to combine their exemptions. When one spouse dies, their assets are transferred to an irrevocable trust.
• Qualified Terminable Interest Property (QTIP): Makes spouses eligible for an unlimited marital deduction, meaning the surviving spouse pays no estate taxes.
• Stand-Alone Retirement Trusts: Names a beneficiary of your retirement account to protect your IRA or 401(k) from creditors or lawsuits.

What Does a Trustee Do?

Assigning a trustee is an essential component of creating a trust. Your trustee will manage the trust and all the assets inside it. For some kinds of trusts, typically revocable trusts, you can assign yourself as a trustee. For other types, you must choose a third party.

Trustees must complete the following duties to the best of their abilities:

• Administer the trust in a legally responsible way
• Manage and invest trust assets
• Control and protect trust assets
• File trust tax returns
• Report trust activity to beneficiaries
• Handle accounting responsibilities of the trust
• Manage the tax standing and any tax issues of the trust
• Distribute income and principal to beneficiaries according to the trust
• Balance the interests of all beneficiaries when making decisions about the trust

How Can a Trusts Attorney Help Me?

Creating a trust is an excellent way to meet many estate planning goals, including allocating money to beneficiaries. As your legal team, we’ll examine your current assets and talk to you about your goals to make sure we determine the right kind of trust for you. We’ll also help you create your trust and talk to you about what assets to put into the trust so you get the most benefit out of this estate planning tool.

The Heritage Law Center has been serving clients in Massachusetts for years now. We’ll use our extensive experience to help you create a trust that meets your estate planning needs. For a consultation, contact our law office by calling (617) 765-9307.