Indianapolis living trust attorneys can provide comprehensive help with the process of creating a trust. Trusts are used for different purposes and it is important to chose the right type of trust that will accomplish the goals that you have. Frank & Kraft will discuss the reasons you’re trying to create a trust and what you hope to accomplish with trust creation and will advise you on what trust type is best to meet your needs.
One popular type of trust is called a living trust, or a revocable living trust. A living trust is a trust that you create during the course of your lifetime and that allows you to retain a significant degree of control over the trust and the assets within it. While a revocable living trust can protect assets in certain ways, and can also provide important protections to your loved ones, this type of trust is not always the best choice and it may fail to provide you with some important benefits that you were hoping for.
Frank & Kraft can help you to identify whether a living trust is the best trust type for your needs or whether you should consider alternative, such as an irrevocable trust. You should call for personalized advice to get in-depth info about the pros and cons of a living trust so you will be better able to assess whether this is the trust you need to create. Give us a call today to find out more.
Advantages of a Living Trust
A living trust is a flexible type of trust that can allow assets to transfer outside of the probate process and that can protect trust assets in case of incapacity.
With a living trust, you can change or modify the trust as often as you like and you can retain control over assets by serving as a trustee. This gives you flexibility. If you do pass away, your living trust will be able to transfer outside of the probate process, which is important to save money on probate costs and to help heirs or beneficiaries inherit more quickly.
If you become incapacitated, a living trust can also be helpful because a backup trustee should be able to immediately take over management of trust assets before any losses can occur due to mismanagement.
Disadvantages of a Living Trust
While a living trust has significant pros, there are some cons to this kind of trust as well. One of the biggest downsides to the creation of a living trust is that you don’t get many of the protections that you could obtain though creating an irrevocable trust.
Since you still have control over the trust and its assets when you create a living trust, those assets still count as belonging to you. If you get sick and need nursing home care, the living trust and assets within it will count as financial resources.
You will likely need to obtain Medicaid to pay for nursing home care, since most private insurers won’t cover nursing home costs and Medicare also won’t pay except under limited circumstances. If you don’t have Medicaid and must go into a nursing home, this is a problem because Medicaid won’t cover you if you have too many resources. Your living trust could end up disqualifying you from getting Medicaid since you have too many assets. You’d have to spend own the trust assets and impoverish yourself before getting covered. Other types of trusts could help you to prevent this from happening by providing more protection for wealth under these circumstances.
Your living trust also will not protect assets from creditors and, while the assets held within the trust can transfer outside of the probate process, the assets still count as estate assets when a determination is made on whether estate tax is owed and how much this estate tax is. There are other kinds of trusts and other tools you can use to transfer assets that may not count those assets as part of a determination on estate tax obligations.
Getting Help from Indianapolis Living Trust Attorneys
Indianapolis living trust attorneys can offer you comprehensive help with the trust creation process. Our legal team will work closely with you to discuss your goals for creating a trust and will explain the different kinds of trusts that could best help you to achieve your objectives. Once you’ve made your choice on creating a trust, we will create a trust document for you that is legally valid so you don’t have to worry about whether or not you’ll actually achieve the necessary steps to get protection for your family and assets.
To find out more about how Frank & Kraft can assist you with all aspects of creating a trust, give us a call today. Our legal team will provide personalized one-on-one advice if you reach out to us at 317-684-1100 or contact us online today. You can also join us for a free seminar to get some insight into creating a trust and how trust creation would potentially work for you.
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.
- Updated Federal Gift and Estate Tax Figures for 2023 - January 26, 2023
- Why Estate Planning Is Important for Multi-National Couples - January 24, 2023
- When Do I Need to Update a Trust Agreement? - January 19, 2023
