Indianapolis living trust attorneys can help you to create a living trust, choose a backup trustee, and fund your trust so it can provide benefits for you and protections to your loved ones. Creating a living trust has many significant advantages and there are many reasons why you may decide that making this type of trust is right for you. However, misunderstandings of what this trust can do are very common, so you want to make sure you understand the limitations and the alternatives before you decide to make a living trust.
You should contact Indianapolis living trust attorneys at Frank & Kraft to find out about the assistance that we can offer you as you create a trust or make use of other tools to protect your assets and your loved ones. Creating a trust is just one way you can take more control over your assets and your legacy and our firm will help you to decide if it’s the right one. Give us a call today to get started on your personalized plan or read on to find out some common myths and misconceptions about living trusts that you should be aware of.
Myths: A Living Trust Protects Assets in Case You Have to Pay for a Nursing Home
Many people assume that if they transfer assets to a trust, they no longer are considered to be the owner of those assets since the trust owns the wealth. This is important when trying to qualify for means-tested benefits like Medicaid because Medicaid will disqualify you from getting coverage for care if you have too many assets. Medicaid is, for most seniors, the only source of payment for nursing home care so being able to qualify for Medicaid is vital.
Unfortunately, when you transfer your assets into a living trust, you generally still maintain substantial control over the trust assets and can generally access those assets if need-be. As a result, the assets can still count as resources when Medicaid eligibility is determined and you could thus still be disqualified from Medicaid paying for the costs of your care if you need expensive nursing home services or if you need long-term care at home.
Myth: A Living Trust Keeps Your Wealth Safe from Creditors
Just as a living trust won’t put your trust assets beyond the reach of a nursing home, you also cannot just avoid repayment of creditors solely by transferring assets into a living trust. While living trusts do protect your assets in certain ways — such as by making sure a backup trustee will immediately be able to take control over the trust assets if something happens to you — living trusts don’t put typically put assets off limits to creditors if you aren’t able to pay your debts.
Myth: A living Trust Will Allow You To Avoid Estate Tax
If you are going to owe estate tax, you may assume that a living trust will allow you to avoid getting hit with a tax bill since you can transfer assets outside of the probate process if those assets are held in a trust. However, the assets in the living trust can still count for purposes of determining the value of your taxable estate. This means that they count when determining if you’ll owe taxes based on the total estate value and they will also count in determining how much you’ll owe.
Getting Help from Indianapolis Living Trust Attorneys
Indianapolis living trust attorneys at Frank & Kraft will help you to understand exactly what living trusts can do to benefit you and what these types of trusts do not do. We can also work with you to consider other asset protection tools or tools to protect your family in circumstances where a living trust is not the right choice. Whether you need help creating a legally valid living trust or aren’t sure what type of tools are the right ones, our firm will provide the guidance and support you need to make informed choices and carry out a plan that is right for you.
To find out more about the services that the Indianapolis living trust attorneys at our firm can offer, join us for a free seminar. You can also give us a call at 317-684-1100 or contact us online at any time to get personalized one-on-one help and support.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.
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