COMMUNITY RESOURCES AND SERVICES
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COMMUNITY RESOURCES AND SERVICES
Why Would I Consider A Trust For My Everyone needs an estate plan, Estate Planning? it doesn’t matter what your socio-economic circumstances are.
A simple estate plan will typically contain at least three documents. This will generally include a durable medical power of attorney and a durable financial power of attorney. The other document typically found is a way to pass your property upon death such as a will. However, there are times when a trust might be an option in your estate planning instead of or in addition to a will. So why should you consider a trust? Trusts are useful estate planning tools that can accomplish a variety of goals. They can help avoid probate, minimize taxes, and be used to give property to minor or disabled loved ones. Trusts can be created during a person’s lifetime (Living Trusts) or at the person’s death (Testamentary Trusts). Some different types of Trusts from both categories are discussed below. Living Trust A person can transfer their assets to a Living Trust and, as trustee, continue using their assets as they always have. Tax Planning Trusts Several different types of Living Trusts provide flexible alternatives for minimizing capital gains and estate taxes, including the Charitable Remainder Trust, Irrevocable Life Insurance Trust, Qualified Personal
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Residence Trust, Grantor Retained Annuity Trust, and Grantor Retained Unitrust. Testamentary Trusts A person can create a Trust under a Will, called a Testamentary Trust, which does not take effect until they are deceased. Disability Trusts (also known as Special Needs Trusts) A Disability Trust is a type of Living Trust that allows a disabled person under the age of 65 to use their own assets for their special needs, other than food and shelter, and keep public benefits, such as Medicaid and Supplemental Security Income (SSI). 3 Reasons You May Need a Trust As Part of Your Estate Plan n A re you concerned about protecting a gift from creditors or litigation? n D oes a loved one need nursing home care or Medicaid eligibility? n D o you want to provide for children, grandchildren or charitable organizations? Continued on page 26
