Safeguard Your Assets and Your Family through Trusts
Bratton Scott Lawyers Offer Comprehensive Estate Planning Services in NJ and PA
It’s certainly natural, as we age, to become concerned about making sure we have the means to support ourselves through retirement, and hopefully something extra to leave to loved ones and charities when we’re gone. A trust is a great way to prepare to meet those concerns while minimizing tax implications.
Trust creation is a complicated process; you should not leave it in the hands of just “any” attorney. At Bratton Scott, our attorneys focus exclusively on estate planning. By doing so, we’re able to offer a superior level of service to our clients in the area of trust creation. Our vast experience and meticulous attention to detail, combined with our dedication to our clients, make us a recognized authority when it comes to drafting trust and estate documents in the areas we serve in New Jersey and Pennsylvania.
Different Situations Require Different Trusts
A trust is a legal document that permits you to put aside assets on behalf of another person, called the beneficiary. A trust appoints another person, a trustee, to manage the assets set aside in the trust. Trusteescan be an individual or an organization. There are many kinds of trusts, including:
An Express Trust – This trust places the assets in a trust on behalf of at least one beneficiary. The trustee is given powers to handle the income from the trust and to distribute the principal. These are commonly used to protect:
- Minors. The appointed trustee may use the money in the upbringing of the minor, including medical, educational and support needs. The minor may have access to the funds through the trustee until a specified age, at which time control of the money may be handed over.
- Life interests. The trust pays the income to a beneficiary for the beneficiary’s lifetime. When the beneficiary dies, the money goes to someone else – a relative, a charity, or a friend.
Special Needs’ Trusts – These trusts are designed to help people who are eligible for government assistance, as some programs disqualify those whose incomes or assets are too high. A special needs’ trust allows an individual with special needs to continue to receive government benefits, while still receiving money from the trust. These trusts can be funded with assets from a third party or the disabled party from a settlement or inheritance.
A Dynasty Trust (a.k.a. Generation Skipping Trust) – Assets that are passed down through the generations are repeatedly taxed every time they are transferred. A dynasty trust is designed to minimize estate taxes by allowing the trust to be taxed only once. A dynasty trust can also protect your assets from creditors and the spouses of the beneficiaries.
Standby Trust (a.k.a. Pourover Trust) – This type of trust is created while the grantor is alive, but no assets are placed in the trust upon its creation. When the person dies, the will transfers the money to the trust. This type of trust is used mostly for married couples.
Protective Trust – These trusts are designed to prevent future creditors from collecting from the trust assets. We can explain how protective trusts work and how they can safeguard your assets in the future.
Credit Shelter Trust (a.k.a. Bypass Trust) – The first $5.34 million dollars of your estate is exempt from federal estate taxes. Some states tax at a lower threshold. In New Jersey, for example, only $675,000 is exempt from state tax. In cases where the death of one spouse would leave the other with more than that amount, a credit shelter trust can protect the surviving spouse from paying excessive taxes.
Contact Bratton Scott for Estate Planning and Trust Advice
We will explain, as part of our overall comprehensive estate planning, how trusts work and how they can benefit you and your loved ones. Contact us for a consultation with an experienced lawyer at Bratton Scott. We will review your situation, explain your options and draft the right documents for your estate planning needs. Call 856-857-6007 or fill out our convenient online form to request your confidential consultation today.