Trusts have become increasingly popular estate planning tools because they can be used to transfer assets after death without going through the court-supervised probate process.
A trust is a legal agreement that provides for an individual, called a grantor, to transfer ownership of their assets into a trust. The assets of a trust are then managed by a trustee, in the interest of its beneficiaries. There are many different types of revocable and irrevocable trusts that are intended for different purposes and must be precisely drafted and executed. If you’re interested in setting up a trust, it’s important to work with an experienced Massachusetts estate planning attorney that can guide you through the process. The Botelho Law Group is the most well-respected estate planning firm in Fall River Massachusetts. Call (888) 269-0988 to schedule a free confidential consultation.
The most common type of estate planning trust is the revocable living trust. This type of trust allows the grantor to retain control of the assets of the trust during his lifetime, including the power to amend the terms, remove specific assets and even to completely terminate the trust. The main advantage of a revocable living trust over passing assets through a will is avoidance of a lengthy and costly probate process. There are also tax advantages for the beneficiaries, ways to protect the principal for beneficiaries that don’t handle money well, plus avoiding a public record of assets. An experienced Fall River, Massachusetts estate planning attorney can help you decide if a revocable trust would be a beneficial addition to your estate plan. Call (888) 269-0988 to schedule a free confidential consultation.
This type of trust can enable a grantor to be eligible for public health benefits for long term care while preserving their assets. The protection does come with a downside, as the trust must be irrevocable and the grantor is limited in the use of the assets during his lifetime. This type of trust is beneficial for middle class people that cannot afford expensive long term care insurance and whose assets would be depleted by the cost of long term care within a couple of years. It is usually constructed so that the assets of the trust, under the control of the trustee, can be used to pay expenses for the creator such as rent, maintenance costs of a co-op or condo, vacations, clothing, food and even some luxuries, but direct access to the principal is restricted.
Special Needs Trust (SNT)
A special needs trust, also known as a “Supplemental Needs Trust,” enables an individual to provide for a disabled child or other beneficiary whose basic needs are provided by Supplementary Security Income (SSI,) Medicaid, Food Stamps and/or housing assistance. These means tested programs limit the income and assets of recipients, and a lump sum payment would reduce benefits, and could even cause the recipient to lose their eligibility. A SNT must be an irrevocable trust, which means that once it’s formed it cannot be changed or dissolved. It can provide recreation, restaurant meals, out of network healthcare and education, as well as luxuries such as travel and fine clothing, without causing the beneficiary to lose their benefits. In order to qualify the beneficiary must be under the age of 65 and the trustee must have “sole discretion over the use of the trust funds.
Charitable trusts have tremendous tax benefits for high net worth individuals. They are irrevocable trusts that allow the income of the trust to be used for the benefit of the grantor and/or named beneficiaries. The income from the trust is taxable, but there are tax benefits when the trust is created, and upon the death of the donor, as the assets become eligible for an estate tax charitable deduction. The trust also benefits due to sales of its investments not being subject to capital gains tax.
Massachusetts and Rhode Island Trust Attorneys
If you’re considering setting up a trust, it’s important to hire experienced Fall River, Massachusetts trust attorneys that can ensure that your trust is properly drafted and executed. The Botelho Law Group is the most well-respected estate planning firm in Fall River Massachusetts. Call (888) 269-0988 to schedule a free confidential consultation.
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Joseph F. Botelho, Esq.
BOTELHO LAW GROUP
Attorneys At Law
901 Eastern Ave.
Fall River, MA 02723