Trusts Attorneys in Conway, Arkansas Assisting Clients in Setting up Trusts

A trust can be an important part of any comprehensive estate plan. Having a trust can have many advantages, including tax benefits, protection of assets, and financial security for vulnerable family members, among others. Different kinds of trusts are appropriate for different circumstances, and the skilled trust lawyers at Dudeck Law Firm have the education and experience to help you decide which kind of trust might be best for you and your family. Call our Conway office today at 501-327-3527 to speak to one of our top-notch estate planning attorneys about setting up a trust.

What Are The Different Kinds of Trusts?

Trusts can fall into several different categories.

• Revocable trusts are trusts that can be changed or ended by the grantor at any time. Assets can be added or removed, as well.
• Irrevocable trusts cannot be changed or ended once they are finalized, and assets cannot be added or removed. They are mainly used in large estates to minimize gift and estate taxes or to provide for children and vulnerable adults.
• Living trusts are in force during the grantor’s life, and the assets within them are usually available for the grantor’s use. Living trusts can be irrevocable, but most are revocable.

• Testamentary trusts come into being after your death according to your last will and testament. The terms of a testamentary trust are established in your will and can be changed at any time up until your death.
• Irrevocable life insurance trusts allow for the proceeds of your life insurance to be placed into a trust that is outside your taxable estate. While the funds are still available for your family to use, there are tax advantages and other benefits to using a trust in this way.
• Special needs trusts are set up to provide for a disabled family member. The special needs trust allows for their money to be safely managed by a trustee that you name rather than going to the special needs person in a lump sum. This also allows the disabled person to remain eligible for government benefits like SSDI, Medicare, and Medicaid, which a lump-sum inheritance would not.
• An AB trust, also known as a credit shelter or bypass trust, allows a wealthy couple to pass assets to their children without paying estate taxes. The trust is structured so that upon death, the assets are transferred to beneficiaries (usually children) while still allowing the surviving spouse rights to the assets and any income generated for the remainder of their life.
• Charitable remainder trusts are irrevocable trusts that allow assets to be held in trust, and the grantor may receive income from the trust until their death, at which time the remainder of the trust is transferred to a charity that the grantor has chosen.

Knowing all the ins and outs of the different kinds of trusts and which one is right for your particular situation is a job better left to professionals. Our experienced estate planning attorneys can help you with all your estate planning and trust needs.

What Are the Different Roles Assigned in a Trust?

A trust typically involves three roles: grantor (or settlor), trustee, and beneficiary.

• The Grantor or Settlor is the term for the person who sets up the trust. They may or may not be the Trustee.
• The Trustee is the person who manages and administers the trust. The trustee controls all of the assets in the trust, such as bank and investment accounts, stocks, bonds, and real estate. Often, backup or successor trustees are named in case the initial trustee can no longer serve.
• The Beneficiary is the person or entity entitled to the use of the assets inside the trust. In a typical living trust, the parents are the grantors, the initial trustees, and the beneficiaries. When the parents become incompetent or incapacitated, they are still the grantors and beneficiaries but are no longer the trustees. Someone they have named as the successor trustee will take over the management of the trust. Upon their death, typically, their children become the beneficiaries.

What Are Some of the Common Benefits of Trusts?

There are several advantages to trusts. Here are some of the common ones. Trusts can help to:

• Avoid Probate: Usually, assets that are being passed to beneficiaries have to go through the probate process, which can be time-consuming and expensive. Trusts avoid probate.
• Maintain Privacy: Because trusts do not go through probate, it is usually possible to keep them out of the public record. Probate, however, is a public process.
• Provide Tax Advantages: Some types of trusts remove the assets from your estate, which can help reduce estate and gift taxes in some cases.
• Protect Assets From Creditors: Once assets are transferred out of your estate and into a trust, they can be sheltered from creditors and judgments against you, as they do not technically belong to you anymore.
• Allow Control of Assets: Because you can set the terms of the trust, you can control who gets your assets and when after you die. For example, you might specify that instead of your children getting a large lump sum in their late teens or early twenties when they might not have the wisdom to handle it well, you could specify that they only get a certain amount per year until they reach an age that you determine.

Do I Need an Attorney to Create a Trust?

There are many legal requirements for setting up a trust, which is a complicated fiduciary instrument. Completing the required paperwork and setting up the trust in a way that meets all requirements and will hold up in court is best left to estate planning attorneys from Conway who have the benefit of years of experience setting up trusts for clients like you. Call Dudeck Law Firm today at 501-327-3527 to speak with one of our experienced estate planning lawyers.