What is Estate Planning?
Estate Planning is a term that is sometimes misinterpreted. However, the true meaning of the term involves a comprehensive effort to examine the assets owned by an individual or married couple, consider their objectives for dividing assets at death, and minimize the taxes paid as a result of either one or both of them passes away.
While there are different types of Living Trusts, a basic Living Trust will allow your heirs or designated beneficiaries to transfer your assets without costly and protracted probate proceedings. A Living Trust is a legal entity that transfers designated assets outside of your probated estate upon death. The assets are held in the name of the trust for the benefit of appointed beneficiaries, so those persons do not technically own them. A revocable living trust enables you to control your estate while alive (access assets, alter who inherits). It is also more specific than a will in indicating to whom, when and how assets are distributed.
Benefits of a Living Trust
- No probate The probate process takes months, consumes a percentage of the assets and is public record. Trust administration is quick, inexpensive and completely private.
- Creditor protection Upon your death, the assets are transferred (not directly to your beneficiaries) to a trust(s) that will protect your beneficiaries from creditors and predators (divorces).
- Estate tax reduction Your spouse is exempt from estate taxes (up to a marital exclusion amount). When that spouse dies, your children become beneficiaries of the remaining trust assets, eliminating or minimizing estate taxes.
- Health care Our living trusts include detailed instructions in the event of your incapacity. For example, you can specify that the trust pays for at-home nursing or assisted care as long as possible before a nursing home is necessary.
A Living Trust, unlike a Will, will allow you to avoid probate proceedings, and the costs that are associated with it. With a Will, when you die, your estate passes to the people named in your will after a long trip through probate court. A Living Trust will allow your assets to transfer relatively quickly, most of the time within weeks or months. A Will entered into Probate Court can sometimes take a year or two. In some instances putting assets into the name of your Trust moves that asset out of your estate for calculating estate taxes, thus your heir may pay less in estate taxes. The cost savings in a Living Trust far outweigh a Will.
A Will declares your intentions for distributing your assets, but a living trust takes it a step further. Done properly, this estate planning tool avoids the hassle and costs of probate, reduces taxes for your heirs as well as providing them with creditor protection, assures privacy and provides for your own care if you become disabled.
Do I need an attorney for a Living Trust? If you want it done right. All these advertised websites and paralegal services are NOT licensed Attorneys. They provide “fill in the blank” documents to all clients, and they are not allowed to give you legal advice. They also only provide one document at that low price. If you want to speak to an attorney, they charge more, if you want to add a document, they charge more, if you need a notary, you are required to find your own and pay for it. If you added up their fees for each document that is already included in our comprehensive package, you would find that the fees are similar, however with the Longo Law Group, LLP you get experienced, licensed Attorneys to assist you in preparing your estate plan the correct way. The same Attorneys that are a phone call away when your heirs need help.
Whether you are trying to leave your hard earned estate to your children, or are just trying to minimize estate taxes upon your death, no firm has a more comprehensive estate plan package than the Longo Law Group, LLP. Our basic package includes a Living Trust, Pour Over Will, Durable Power of Attorney, Advance Health Care Directive, and HIPPA Authorization. In most cases, we charge low flat fees. Make an appointment for our free consultation to follow up on the valuable estate planning information we have provided here on our website.
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