TRUSTS

INTRODUCTION

A living trust is a document that allows you to pass on your assets to the person(s) or organization(s) of your choosing. Creating a trust is highly recommended as it helps save time, money and provides asset protection by avoiding probate, the process that courts use to determine which party the property should go to after the property owner's death. The probate process result in significant delays in inheritance and costs in administration, which could be easily avoided with a properly executed trust. At Tsang & Associates, our competent attorneys will provide you with a high-quality trust to help you transfer your estate to your loved ones.  Consultations are free and we look forward to speaking with you.


SERVICES

We will review your list of assets, liabilities, income and your retirement plan to create a strategy to help you transfer these assets while minimizing taxes. In addition to the trust, we also prepare the following legal documents: 

  • Will Drafting and Execution
  • Power of Attorney
  • Healthcare Directive
  • Abstract Trust
  • Attorney Certification of Trust

In short, we provide a start to finish service. Your case is safe with us until the case is complete. 

PAYMENT

Living Trust $2,000*

Irrevocable Trust $3,000*

Special Needs Trust $3,000*

Charitable Trust $3,000*

Free Consultation

*Legal Fees vary based on complexity of each case, and the above quoted price represents the amount we charge for a typical case. 


REVOCABLE LIVING TRUST

A revocable living trust stipulates that the trustor's assets are their own until death, after which they become the property of chosen beneficiaries. The living trust allows a "trustee" to manage the assets until the trustor's death. Many people name themselves as the trustee, but the trustee can be anyone of the trustor's choosing. The trust will stipulate that the trustee must deal with the trustor's assets in an approved way. Under a revocable living trust, the trustor is taxed on the assets in question and any income they may generate until death, unless someone else is the trustee.

Advantages:

  1. A living trust is recommended because it helps avoid probate, a rather long and drawn out process of verifying the will, or the expenses that go along with it;
    1. Probate applies to the property owned at death but will not apply to the property involved in the trust, as that is property controlled by the trustee;
  2. Living trusts are also confidential as oppose to a probate proceeding which is available to the public. 
  3. Revocable living trusts can be annulled any time until trustor's death allowing you to change your mind;
  4. Assures uninterrupted income and access to principal for family beneficiaries;
  5. Eliminates time delays in settling the estate--the successor trustee can immediately disburse the funds as indicated in the living trust agreement.

IRREVOCABLE LIVING TRUST

An irrevocable trust may not be changed once it is signed, unless the beneficiary approves of the change. There are tax advantages to signing an irrevocable living trust, as it stipulates that the trustor is no longer considered the owner of the assets put into the trust. One spouse may sign an irrevocable living trust so that their estate goes to the other spouse as a trustee and vice versa.

Advantages:

  1. When one spouse dies, the assets they put into the trust will not taxed, because they have now been transferred to the trust itself;
  2. An irrevocable trust will also enhance eligibility for Medicaid as long as the trustor won't need it for another 5 years;
  3. Provides for property management or disbursement;
  4. Protects from creditors who are not allowed to claim properties effectively placed in an irrevocable trust. 

CHARITABLE TRUST

A charitable trust transfers truster's assets to a charity. This type of trust will usually be tax exempt. Trusters may generate a will that leaves their assets to a charity before they die such that they will receive a tax deduction, or, if they leave their assets to a given charity after they die, their estate will receive a tax deduction.


SPECIAL NEEDS TRUST

A special needs trust must be completed if the trustor wishes to leave their assets to someone who is disabled. Unfortunately, under traditional trusts, certain assets such as large amounts of cash, would render the beneficiary ineligible for Supplemental Security Income or Medicaid if the beneficiary is disabled. Therefore, signing a special needs trust allows a trustee to handle the money in such a way that benefits the disabled beneficiary, as the presence of a trustee allows the beneficiary to still apply for SSI and/or Medicaid.


Additional Information

Abstract of trust:

An abstract of trust is a document provided that will summarize the trust but omit the name of the beneficiary.

Attorney Certification of Trust:

A Certification of Trust is issued as a statement to prove that the attorneys involved in its creation are familiar with the contents of the trust and that it is valid under any applicable state trust laws.

Healthcare Directive:

A healthcare directive states what specific measures the trustor would like taken in the event that they are dying. The healthcare directive is drafted to dictate who is in charge of medical decisions (your "agent"), preferred specific care, organ donation preferences, and doctor of choice. It should also contain the trustor's signature and the signature of two witnesses. After signing, a copy of the healthcare directive should be sent to the agent, doctor, and healthcare providers.

Power of Attorney:

The trustor may grant an agent power of attorney over certain decisions, such as financial or medical matters that apply to them. They may grant nondurable power of attorney, which will expire when they become incapacitated. They may also grant durable power of attorney, which will continue even after they are incapacitated. Springing power of attorney may also be granted, such that it will take effect only in the event that the trustor is incapacitated a certain way. To be incapacitated is defined as not understanding the gravity of the decisions they are making. 

CHECKLIST

In order to provide you with the best and most accurate consultation, we recommend that you bring as many of the following information/documents as you can to ensure a productive meeting. 

  1. The purpose of trust
  2. Information concerning Truster, Trustee, and Beneficiary
  3. Documentation concerning all financial assets