Revocable and Irrevocable Trusts
Using Trusts to Protect and Manage Your Assets
You can choose from a wide array of trusts to help pass your estate to your children and reduce or avoid estate taxes. Finding the right trust or combination of trusts for your needs requires the assistance of an experienced estate planning attorney.
Protecting Your Assets from Taxes and Medicaid
Trusts are vital tools in asset protection, helping you keep taxes and long-term health care costs from reducing your estate. While you still may be responsible for certain taxes, a trust may be able to help you reduce your tax burden and protect the assets from creditors such as Medicaid. A trustee is appointed to manage, invest and distribute the assets according to the terms of the trust.
Examples of commonly used trusts include:
Irrevocable Trust: can be used to provide asset protection and is used in Medicaid planning.
Revocable Trust: allows you to manage your money while you are still able, and to have a trustee manage your money if you become unable to do so. Trust assets pass to beneficiaries without probate.
Insurance Trust: removes the proceeds of a life insurance policy from your taxable estate, thereby increasing your beneficiaries’ inheritance.
Special Needs Trust: an essential part of special needs planning, this provides long-term support for a special needs child or adult by making payments that supplement the care that a child is getting under government entitlement programs such as Medicaid and SSI. Special needs trusts also provide money management tools for an individual with special needs.
Testamentary Trust: can be used to protect a disabled child, to protect spendthrift children and may include tax planning trusts, including credit shelter trust also known as bypass trusts, A/B trusts and disclaimer trusts.