A trust is a mechanism whereby a person, known as the “grantor,” transfers assets to another person, known as a “trustee,” with instructions, known as the “trust agreement,” stating exactly what the trustee is to do with those assets.
A trust may be created during lifetime, which is known as a “lifetime” or “inter vivos” trust, or may be created by a person’s last will and testament, which is known as a “testamentary trust.”
Trusts are created for a number of different reasons: the trust may be created to manage assets for minor children, to manage assets for an irresponsible adult-child, to manage assets for the benefit of a disabled child and/or to manage assets for the benefit of a beloved pet. Trusts are frequently created to reduce and/or eliminate estate taxes, to protect assets from the claims of creditors and to qualify the grantor for long-term care (Medicaid) benefits.
In recent years, trust have become the preferred method of estate planning for persons of all economic backgrounds. The flexibility and utility of a trust cannot be overstated, and creating a trust should not be overlooked when considering implementing a well advised estate plan.
If you or a loved one would like further information about the use and benefits of creating a trust, or if you or a loved one would like to create a trust in furtherance of your estate plan, do not hesitate to contact our office today.