A Trust is an important piece to your estate plan that allows a third party, or trustee, to hold assets on behalf of your named beneficiary or beneficiaries.
Trusts can be created in a variety of ways and can have many benefits, including what we consider the top 6 most important benefits of a Trust:
1. Help to Avoid Probate
Probate is a legal process that happens after someone dies. A Trust can help avoid the lengthy and expensive probate process by allowing assets to be distributed outside of probate in a quicker and more efficient way.
2. Provide Asset Protection for Minor Child/ren
A Trust gives the creator the ability to name a Trustee to manage the assets for the benefit of the minor child/ren to ensure they are not misused. It also provides additional protection by giving the creator the ability to specify when and how the assets are distributed.
3. Protection From Creditors and Lawsuits
Assets held in a Trust are owned by the Trust, not an individual, and therefore protected from creditors and lawsuits.
4. Provide Privacy
Unlike a Last Will and Testament that becomes public record upon someones passing, a Trust keeps not only the estate assets private but also keeps the beneficiary distributions confidential.
5. Reduce Tax Burdens
Depending on the value of your estate, the current estate tax exemption amount, and the type of trust created, a Trust may reduce tax burdens, such as estate taxes or capital gains tax.
6. Protection for Property Outside of Texas
If a resident of Texas passes away and owned property outside of the state, their loved ones must go through probate in each state there is property owned. Because each state has different probate laws, this can be a very lengthy and extremely expensive experience. Creating a Trust to hold the out-of-state property can avoid the need to go through probate in each state, and the property can pass directly to the intended beneficiaries listed in the Trust.
As seen above, there are many benefits of a Trust. They can give maximum control over wealth and privacy and most importantly, they assist in minimizing conflict and are an integral part of legacy protection.
Start protecting your legacy today by speaking with one of our experienced Dallas Trust Attorneys.
See if a Trust is right for your unique situation by calling our office today at 214-974-8940 or by contacting us online.