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Creating a Living Trust? Read All About It!

Estate planning 2The biggest reasons for choosing a living trust are for the privacy, the efficiency of avoiding public probate and for the protection that can be provided to beneficiaries, like protection from divorce, creditors, nursing home costs, and legal actions.

This can be especially important for a beneficiary who may have special needs. A Special Needs Trust can be created so their government program benefits, like Medicaid, won’t be impacted by their inheritance. Let’s look at some specific situations:

Avoiding probate. A living trust can help avoid probate, but a trust only controls assets that are in the trust. You must put assets into the trust to “fund” the trust. A person can have a well-drafted trust, but if it’s not properly funded, they will most likely lose out on some of the trust benefits.

Tax savings. There may be some tax savings, but most folks aren’t worried about estate taxes. An individual can pass up to $5.49 million without any estate taxes in 2017. Anything above that is subject to a 40% estate tax. Note that a living trust can be structured, so a married couple can pass double the exemption amount free of estate tax between the two of them. There’s usually no estate tax due when the first spouse passes away.  However, the surviving spouse, who may inherit from his or her spouse, would be potentially subject to estate tax at his or her death. A living trust can be used to potentially avoid that and pass the maximum assets without any estate taxes.

Assets requirements for a living trust. There’s no specific dollar amount required for a trust. More importantly, it should be a discussion with your estate planning attorney about your goals and how they can best be accomplished.

There is some expense with creating a trust, but most of the time the amount you spend on a living trust is less than what the cost would be for your family and loved ones to administer your estate plan after you pass away.

Talk about your options for a trust with an experienced estate planning attorney, and then decide.

Reference: Green Bay Press-Gazette (June 29, 2017) “Common questions about a living trust”

 

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We've been putting together as many resources as possible so that we can continue to help:

  • If you’re a current client with a signing appointment or a prospective client with a consultation and would prefer that meeting take place in your own home, we can accomplish that with a little bit of pre-planning on our part and with the addition of a laptop, smartphone, tablet or other computer in your home to facilitate this virtual meeting. For those of you that need to sign legal documents, that too can be accomplished with the use of a webcam (FaceTime etc.), so that we can witness and electronically notarize all of your important legal documents.
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Thank you, Walt and the Zaremba Team

Coronavirus/Covid-19
Update to our Process

The unprecedented coronavirus pandemic has taken our entire country by surprise. We understand how difficult this time is for America’s businesses and families.  However, we believe it is vitally important that we make every effort possible to continue to offer solutions that avoid disrupting our important partnership with you, your family and friends.  As you know, estate planning is not something that should wait for a more convenient time, therefore the opportunity to address your important goals both during and after this crisis should not wait.  To that end, we have added the option of a ‘virtual consultation’ to our office process.  You will now have a choice of either meeting with us in our office or in the comfort of your own home.