According to the 2023 Wills and Estate Planning Survey by Caring.com, only 34 percent of Americans have an estate plan.
The primary reasons respondents gave for not participating in estate planning are:
An estate plan is a comprehensive set of legal documents and strategies that organizes assets for a person’s death or disability. Trusts are legal arrangements used in estate planning, alongside wills and advance directives.
A trust allows one person, known as the trustee, to manage funds and assets for one or multiple beneficiaries.
Trusts can be revocable or irrevocable.
Compared to wills, trusts can be more complex – and therefore more expensive – to set up. The value and utility of a trust will depend on your unique circumstances as well as the type of trust you use.
A primary benefit of trusts is that they allow individuals to bypass probate, which can be time-consuming and costly for surviving loved ones. The court excludes property placed in trust from a probated estate.
According to Legal Zoom, probate costs can consume 10 percent of an estate’s value. The process can also take months to years to conclude, burdening family members.
Transferring assets outside probate via a trust also maintains privacy. The public can access probate records. The contents of a will might become publicly accessible since wills go through probate. But trusts, which stay outside probate, remain confidential.
In addition to avoiding probate, trusts can have tax benefits. By creating an irrevocable trust, individuals can lower the value of their taxable estate while transferring property to their loved ones.
When you use a trust, you can have more control over assets than if you gave them to the recipient directly.
Older people and those with disabilities can also use a type of irrevocable trust known as a Medicaid Asset Protection Trust (MAPT) to qualify for Medicaid.
Individuals intending to use Medicaid to pay for long-term care may place into a MAPT certain assets that would otherwise disqualify them from Medicaid. Once Medicaid’s look-back period has elapsed, they can qualify for benefits. Since a MAPT is irrevocable, the grantor no longer controls and owns the assets. As they can assign beneficiaries, they can transfer and benefit from their wealth without first exhausting their assets to go on Medicaid.
If you intend to rely on Medicaid in your retirement, consider speaking with an estate planning attorney to learn more about whether a Medicaid Asset Protection Trust could benefit you.
One type of trust that can be an invaluable estate planning tool for older adults with disabilities is a special needs trust (SNT). This type of trust can preserve the beneficiary’s eligibility for Supplemental Security Income and Medicaid while providing for needs that public benefits do not cover. The trustee can use the SNT to pay for things like caregiving, outings, and entertainment.
While not everyone needs to create a trust as part of a solid estate plan, trusts can benefit many people in transferring wealth. Speak to your estate planning attorney to learn more about the optimal estate planning strategy for you.
Most of us spend little time thinking about death or losing the capacity to manage our own affairs. These are unpleasant topics and banishing them from our minds is easier than entertaining them. Death, however, is inevitable and becoming...
Inheritance tax is a state-level tax that beneficiaries pay when they receive assets from an estate after somebody has passed away. The inheritance tax is distinct from estate taxes, but planning tools for avoiding or minimizing it, such as...
The Internal Revenue Service (IRS) has released its tax inflation adjustment figures for tax year 2025. Annual Gift Tax Exclusion Effective January 1, 2025, you will be able to make individual gifts of up to $19,000 in the calendar year (an...
Estate planning involves various legal instruments, such as wills, trusts, powers of attorney, and healthcare directives. We specialize in estate planning, ensuring that your documents comply with the ever-changing state and federal laws. We can help you navigate intricate legal requirements, minimizing the risk of costly errors and potential disputes.
Every person's financial situation and family dynamics are unique. We will take the time to understand your goals and circumstances, allowing for the creation an estate plan that suits your individual situation.
We can assist you in structuring your estate plan to protect your assets from potential creditors, lawsuits, and taxation. Our experience can also help you employ strategies to minimize tax liabilities.
Probate is the legal process through which a deceased person's assets are distributed. It can be time-consuming and costly. We can help you explore options to minimize or avoid the probate process, allowing your beneficiaries to receive their inheritances more quickly and efficiently.
When estate plans are unclear or disputed, it can lead to conflicts and legal battles. We can help you draft clear and legally sound documents that minimize the chances of disputes among heirs and beneficiaries. In the event that a dispute arises, we can also represent your interests and work toward an amicable resolution.
Estate plans need to be reviewed and updated periodically to reflect changes in your financial situation, family dynamics, and applicable laws. We can provide ongoing support and guidance, ensuring that your estate plan remains current and effective.
Engaging a law firm for estate planning provides peace of mind, knowing that your affairs are in capable hands. It allows you to focus on enjoying your life without the constant worry of what may happen to your assets and loved ones in the future.
Estate planning involves various legal instruments, such as wills, trusts, powers of attorney, and healthcare directives. We specialize in estate planning, ensuring that your documents comply with the ever-changing state and federal laws. We can help you navigate intricate legal requirements, minimizing the risk of costly errors and potential disputes.
Every person's financial situation and family dynamics are unique. We will take the time to understand your goals and circumstances, allowing for the creation an estate plan that suits your individual situation.
We can assist you in structuring your estate plan to protect your assets from potential creditors, lawsuits, and taxation. Our experience can also help you employ strategies to minimize tax liabilities.
Probate is the legal process through which a deceased person's assets are distributed. It can be time-consuming and costly. We can help you explore options to minimize or avoid the probate process, allowing your beneficiaries to receive their inheritances more quickly and efficiently.
When estate plans are unclear or disputed, it can lead to conflicts and legal battles. We can help you draft clear and legally sound documents that minimize the chances of disputes among heirs and beneficiaries. In the event that a dispute arises, we can also represent your interests and work toward an amicable resolution.
Estate plans need to be reviewed and updated periodically to reflect changes in your financial situation, family dynamics, and applicable laws. We can provide ongoing support and guidance, ensuring that your estate plan remains current and effective.
Engaging a law firm for estate planning provides peace of mind, knowing that your affairs are in capable hands. It allows you to focus on enjoying your life without the constant worry of what may happen to your assets and loved ones in the future.
Mon - Thurs: 9AM - 5PM
Friday: 9AM - 2PM
