A trust is a fiduciary relationship where a third party, known as a trustee, holds assets on behalf of a beneficiary. Trusts are useful in estate planning because they avoid the expense, hassle and public record of a probate proceeding, in addition to tax benefits. Other reasons to consider creating trusts include being able to precisely control how the timing of distribution of the assets and protection from your beneficiaries creditors. There are two basic types of trusts, revocable and irrevocable trusts. Revocable trusts have the advantage of offering you more flexibility should your needs change, but irrevocable trusts can sometimes provide more powerful asset protection. The Botelho Law Group is a top estate planning attorney in Fall River, Massachusetts. We will patiently guide you through all of your options to create an estate plan that meets your needs. Call (888) 269-0988 to schedule a free confidential consultation.
The traditional reason to create an irrevocable trust is the funding of legacies for children, grandchildren and charities. Even though you can’t dissolve or alter an irrevocable trust, it can instruct the trustee to use the assets for your benefit during your lifetime. In addition the tax benefits, protection from creditors, ex-spouses and the spending habits of your beneficiaries, irrevocable trust can become popular for helping middle class people pay for long term care without depleting their assets, giving money to beneficiaries with special needs that are collecting public assistance and reducing taxation of life insurance proceeds. The best way to find out what would work best for you, is to speak to an experienced Fall River, Massachusetts Wills and Trusts lawyer about your particular estate. The Botelho Law Group is a top estate planning attorney in Fall River Massachusetts. Call (888) 269-0988 to schedule a free confidential consultation.
Due to the astronomical cost of long term residential care, in Massachusetts and throughout the country, Medicaid trusts are used by middle class people so that the cost of long term care does not deplete their entire estate. The decision to form a Medicaid trust must be made well in advance due to Massachusetts’ five year look back period for Medicaid eligibility. This means that you need to successfully transfer your assets into a Medicaid trust more than five years before entering a long term care facility. You can still have access to the use of your assets with a Medicaid trust, but they will be controlled by the trustee and the terms of the trust. For example, your home can be owned by the trust, giving you the right to live in the home until your death. The trustee could sell your home and purchase another home for you to live in, as long as the profits are reinvested in the trust. If this is done properly, the trust will not be considered a countable asset for the purpose of Medicaid/MassHealth.
Special Needs Trust in Massachusetts
Creating a special needs trust (SNT) for a disabled friend or relative can provide them with a security, safety and enhanced quality of life well after you’re gone, without causing them to lose Medicaid, SSI or other benefits that they need. A well drafted SNT can enable the assets to be used for a wide range of benefits including purchasing a home or vehicle, owned by the trust, for their use. The trust can fund vacations, educational expenses, mobile phones and internet service. It’s important to understand that the assets can be used to pay rent, but it will reduce the SSI benefit that is received. You must be very careful who you choose as trustee for an SNT because failure to follow all the instructions in the trust document could jeopardize the beneficiaries SSI and Medicaid benefits. That’s why it might be prudent to use an attorney or bank as a trustee for an SNT even though there would be a fee paid from the trust assets. The Botelho Law Group is a top estate planning attorney in Fall River Massachusetts. Call (888) 269-0988 to schedule a free confidential consultation.
Spendthrift Trust In Massachusetts
A spendthrift trust is a type of trust that is designed to control the beneficiary’s access to the principal. It’s useful if you’d like to leave assets to a son, daughter, other relative or friend that has a poor track record for managing money, creditor issues, a shaky marriage that might result in a contentious divorce, has drug/alcohol problems or a gambling habit. You might also want to consider it for a beneficiary that is likely to be taken advantage of or is in a profession where they have a large chance of being sued such a doctor that could be sued for malpractice. The trustee will be in charge of distributing the assets based on your wishes and the beneficiary has no control of the assets in the trust. It’s important to note that creditors can reach the assets after they are distributed to the beneficiary. There are often difficulties when family members serve as trustees for a spendthrift trust due to constant demands from the beneficiaries for more money after they’ve “drank it away” or blown on a lead about a fast horse. In such cases, it’s worth considering using an attorney or a bank as trustee, the fees paid from the trust for this purpose are well worth it. It should be noted that a spendthrift trust can also be revocable, but making it irrevocable prevents the beneficiaries from complaining about it during your lifetime. It’s important to speak to a knowledgeable and patient estate planning attorney about whether a spendthrift trust is the right tool for your estate plan. The Botelho Law Group is a top estate planning attorney in Fall River Massachusetts. Call (888) 269-0988 to schedule a free confidential consultation.
Massachusetts and Rhode Island Trusts Attorney
Trusts are complicated estate planning instruments that must be carefully thought out and carefully drafted. The choice of trust and the individual that will serve as trustee are also important decisions. The Botelho Law Group is a top estate planning attorney in Fall River Massachusetts that will patiently guide you through the options and help you choose the right trusts for your estate plan. Call (888) 269-0988 to schedule a free confidential consultation.
Joseph F. Botelho, Esq.
BOTELHO LAW GROUP
Attorneys At Law
901 Eastern Ave.
Fall River, MA 02723