If you are going through the estate planning process, you may wonder whether you need to place your assets in a trust. A trust can help you transfer your property to your beneficiaries much more smoothly and avoid some types of tax on the assets you hold.
There are two kinds of trusts available to the public. In a revocable or “living” trust, you retain control over the assets in the trust during your lifetime and the right to dissolve the trust at any time. In an irrevocable trust, your assets are transferred out of your estate—and out of your control—for the rest of your life, and the trust cannot be dissolved once it has been established.
Benefits of Creating a Trust With Your Estate Plan
The most well-known benefit of placing assets in a trust is that these assets will not have to go through probate, giving your beneficiaries much faster access to property you’ve left them. While both kinds of trusts make it possible to avoid going through probate in Rhode Island, irrevocable trusts are also generally not subject to estate taxes, allowing your beneficiaries to inherit a greater portion of your wealth.
Other benefits of trusts include:
- Control over your assets. You have full control of the arrangement and terms of a trust, controlling how, when, and to whom your assets will be distributed.
- Reduce family disputes. A trust can be constructed to grant a certain amount of money each month to beneficiaries who do not make good financial decisions, or it can be structured to make payments to step-children or children from more than one marriage without enmity.
- Maintain privacy. The probate process is a matter of public record, so by avoiding probate the details of your estate will remain private.
- Have protection. Unlike a will, a living trust allows your trustee to gain control of your assets immediately if you become ill or incapacitated without the need to go to court.
If you need help with a probate dispute or are thinking about building your own estate plan, our experienced legal team can help. Call us today, or fill out our online contact form to get started.