If you’ve never thought about a lifetime trust, it’s likely due to your disliking of the idea of going through probate. Lifetime trusts have been heavily pushed on that thing alone in the past, and, yes, lifetime trusts certainly do avert probate. Nonetheless, there’s more to lifetime trusts than that alone:
- Property Protection for Certain Beneficiaries
This isn’t really mentioned as a reason for lifetime trusts, although it’s actually one of the most important ones. When a lot of people think about estate planning, they tend to think about giving property to their loved ones after their departure. But, sometimes their intended beneficiaries just aren’t capable of managing an inheritance.
- Avoiding a Will Contest
It is also a fact that somebody may try contesting a will than a revocable lifetime trust by far. That’s due to the fact that a will only goes into effect after someone has passed away, whereas a revocable lifetime trust goes into effect as soon as the trust has been signed and lasts for some amount of time after the owner’s death.
- A Lowering or Elimination of Estate Taxes
Many people believe that a revocable lifetime trust cannot save on estate taxes. However, lifetime trusts are often used by individuals and families to obtain the benefits of certain deductions and credits allowed under tax laws.
- Avoidance of Probate
It is true that any property in lifetime trusts will not go through probate after a person’s demise and that’s because the trust spells out who will get the property. It’s a lot similar to life insurance, where properties do not go through probate because they already have a specified beneficiary.
Many people have a certain dislike of the idea of probate because of it being a public process. In theory, anyone can go to a probate court when someone dies and look at the estate file. You can even get to view the will and ascertain who the relatives and beneficiaries are. You can also get to look at the claims of creditors and the list of assets. It has even been known for unprincipled sales persons to look through estate files to check out grieving heirs to prey on. Sometimes disgruntled heirs, and even friends and neighbours, have in the past, been known to look into an estate file to see what the contents are!
Attaining a lifetime trust can put a stop to all of this. Lifetime trusts are not only confidential, but they also don’t get filed with a probate court, and no one at all will get to look at them unless the grantor or the trustee lets them.
And those are the key reasons why it’s simply a good idea to get a lifetime trust. Should only one or more of the above reasons apply to you, then think about consulting a legal a professional and look at whether a lifetime trust makes any sense in your estate planning.
Contact legal professionals for the above and much more regarding such issues.