Why Trusts are created:
All Trusts are created to provide beneficiaries with income or principal (property). Property titled in a trust avoids probate. Trusts may be structured to:
- Protect the trust property from creditors and future ex-spouses of a beneficiary,
- Minimize or allocate tax load,
- Motivate a beneficiary to be productive, or refrain from destructive conduct,
- Assist a special needs beneficiary to qualify for state or federal benefits, or
- Prevent a beneficiary who is a spendthrift from becoming penniless.
Below is a list of trusts we assist in creating and administering:
- Revocable trusts when they become irrevocable
- Self-settled asset protection trusts (Nevada grantor beneficiary asset protection trusts)
- Spousal Life Access Trusts (SLATS)
- Grantor designated beneficiary IRA trusts
- Life Insurance Trusts and Crummy Letters
- Charitable remainder trusts (CRT)
- Charitable uni-trusts (CRUT)
- Qualified Terminal Interest Trusts for spouses and remainder beneficiaries (QTIP)
- Generation Skip Transfer Trusts
- Grantor Defective Trusts
- Dynasty Trusts
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Commonly used terms for trust
If you are not familiar with trusts, these brief definitions will help you understand and give you a working knowledge of the terminology revolving trusts. If you are familiar with trust, then a quick review may also help you. The definitions herein should be read to give you a working knowledge of terms revolving trusts. While we believe they are good, they are not legal authority.
Some considerations when creating a trust:
- Family or beneficiary dynamics (other than the main purpose of the trust, this the most important consideration).
- Competencies and propensities of individuals designated to serve as trustees.
- Difficulty of administration of the trust (odd requirements).
- Property to be titled in the trust.
- Tax load and allocations.
- State trust is created and will be administered.
- Setting a beneficiary up for an unintentional felony.
- Violations of state and US Constitutions.
- Titling of odd assets to the trust such as crypto currencies, oil and gas, collectibles, marijuana and gaming businesses.
The following are typical matters to be addressed in a trust administration:
- Determining when a trust comes into existence.
- Determining when trustee duties come into existence.
- Marshalling (finding and controlling) and determining status of trust assets.
- Determining status of beneficiaries.
- Providing notice of existence and terms of the trust to beneficiaries.
- Providing an inventory of trust property to beneficiaries.
- Establishing and funding sub-trust that may be created under the trust terms.
- Determining tax reporting requirements and payment of taxes such as estate and income taxes.
- Obtaining tax identification numbers.
- Determining creditors, if any, providing notice for opportunity to file claim, and payment of legitimate claims.
- Providing an accounting of financial transactions during the administration at regularly required intervals, and sub-trusts if applicable.
- Identifying and installing the Trustee.
- Calculate and prepare plans of distributions to beneficiaries.
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