There are many different parts to an estate plan. This can often make it overwhelming to create one. However, it is extremely important to do so. An estate plan allows you to prepare for the future of your assets. During the process of creating an estate plan, there are many different tools that can be used to help you prepare. One of these is a trust. When using these tools, it is important to have a basic understanding of them and how they can benefit your estate. Continue reading below to learn more about trusts.
What is a Trust?
Many people use trusts within their estate plan to manage assets. This is essentially a contract between the estate and a trustee. A trustee is an individual who manages the assets within a trust on behalf of the person who will inherit it, known as the beneficiary. This allows the trustee to care for the assets on behalf of the beneficiary until they can do so themselves. There are a variety of different trusts that can be used in a New York estate plan, including:
- Revocable Trust
- Irrevocable Trust
- Testamentary Trust
- Inter Vivos Trust
- Life Insurance Trusts
- Special Needs Trusts
- Charitable Remainder and Charitable Leads Trusts
What are the Benefits of a Trust?
Every tool that is used to create an estate plan is different from the other. It is because of this that they also provide their own benefits. The benefits of a trust include:
- Probate avoidance: Probate, a lengthy and costly court proceeding, takes place during estate administration. However, this can be avoided by using a trust in your estate plan.
- Tax reduction: Trusts can help you reduce estate and gift taxes on your estate.
- Control over disbursement: With a trust, you have more control over asset disbursement than a will would allow. A trust can reduce the chances of a beneficiary taking part in poor financial decisions and negatively impacting their inheritance.
Contact our Firm
If you or a loved one needs assistance creating an estate plan and wish to speak with an experienced attorney, contact the Law Office of Andres D. Gil, PLLC today.