What You Need to Know About Trusts
If you are going through the estate planning process, you might be thinking about having a revocable trust drafted. You might also wonder if a revocable trust is right for you— perhaps there could be an alternative option that is more suitable? Before you initiate the process, you and an estate planning lawyer should carefully analyze your goals, applicable taxes, and assets to determine whether a revocable trust is a good choice. At Bott & Associates, Ltd., we understand that this can be a confusing matter. It’s our goal to help our clients create estate plans that best suit their needs.
Is a Revocable Trust a Good Choice?
An experienced estate planning lawyer Rolling Meadows, IL relies on will have likely drafted both revocable and irrevocable trusts. If you’re considering either option, you’ll want to speak with a lawyer in Rolling Meadows, IL to ensure that it will be beneficial for your estate planning needs.
Without a close analysis of your financial situation and objectives, it is difficult for any estate planning lawyer to tell if you’re a good candidate. The best way to determine if it is the right option for you is to schedule a consultation with an estate planning lawyer.
That being said, revocable trusts can be very beneficial for some; however, this is typically not the majority.
Claim: A revocable trust helps people to avoid estate and inheritance taxes.
Reality: This type of trust does not reduce any taxes because it can be revoked.
Claim: Creditors cannot put a lien on a revocable trust.
Reality: If you take back any asset, creditors can place a lien on that asset. If you’re interested in a trust that prevents creditors from claiming assets, you should consider an irrevocable trust.
Claim: Probate is automatically avoided with a revocable trust.
Reality: In order to avoid probate, your assets need to be carefully arranged in the revocable trust. This includes, but is not limited to, bank accounts, deeds, annuities, life insurance policies, etc.
Understanding Revocable Trusts
A revocable trust must be drafted and signed by you in order for it to legally exist. Once this is complete, you can add assets as you please; however, these can be revoked at anytime. Furthermore, most revocable trusts state that all the assets held within are to be used for your care. You will be the Grantor and the sole Trustee.
A revocable trust can hold various assets for your beneficiaries. After your death, your appointed trustee can manage and distribute your assets as described in the trust. When a lawyer structures a trust correctly, it can replace a will. The cost to set up a revocable trust can vary significantly and it often depends upon the circumstances of your own case. In general, if you’re only trying to avoid probate, a revocable trust may not be cost efficient unless you are in certain states. You can talk with an estate planning lawyer from Bott & Associates, Ltd. for more information about your options.
Additional Reasons to Draft a Revocable Trust
- Reduce the possibility of a contested will
- Avoid probate, especially when you have property or bank accounts in multiple states
- Manage your assets and expenditures
Count on Bott & Associates, Ltd. for Your Estate Planning Needs
If you would like to know more about revocable and irrevocable trusts, please call Bott & Associates, Ltd. today to arrange a free consultation with an estate planning lawyer Rolling Meadows, IL families trust.