what are the advantages to keep assets in a trust for my beneficiaries, instead of distributing them...

WHAT ARE THE ADVANTAGES TO KEEP ASSETS IN A TRUST

FOR MY BENEFICIARIES, INSTEAD OF DISTRIBUTING THEM

OUTRIGHT? WHAT ABOUT THE DISADVANTAGES?

“Many people who hope to leave money to loved ones do so

by writing a will. However, there is also another alternative

that you may wish to consider: the creation of a trust.”

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What are the advantages to keeping assets in a trust for my beneficiaries, instead of distributing them outright? What about the disadvantages? www.singerpistiner.com

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Many people who hope to leave money to loved ones do so by writing a will.

However, there is also another alternative that you may wish to consider: the

creation of a trust. A trust allows you to designate beneficiaries who can obtain

money, property and assets. However, a trust is very different from a will. There

are some advantages and some disadvantages associated with keeping assets

in a trust instead of distributing the assets outright. An estate planning attorney

can provide you with guidance and advice on whether a trust is right for you.

UNDERSTANDING TRUSTS

Generally, when you give away assets and property either as a gift while you are

living or in your will, you have limited control over what happens to the assets

and property. The person who receives or inherits the assets takes ownership.


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The recipient can spend the money or use the assets as he likes, and the

property you’ve left him could be vulnerable to being lost in a divorce or taken by

creditors.

When the money or other assets are left to someone in a will, this also triggers

the probate process. Your heirs have to go through this court process before they

can inherit. This can take time and cost money. A will could be challenged

during probate, complicating things even further. Information about your private

property and assets also becomes court record during the probating of the will,

and this public process can adversely impact your privacy and the privacy of your

beneficiaries.


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When assets are kept in a trust for beneficiaries instead of distributed outright via

a will or a gifted transfer while you are alive, you solve many of these problems.

A trust bifurcates ownership and possession. The trust becomes the owner of the

property and assets that you put into it, while the beneficiaries are able to use

and benefit from the items that the trust owns.

WHAT ARE THE ADVANTAGES AND DISADVANTAGES OF

KEEPING ASSETS IN A TRUST

People choose to use trusts frequently because of the many benefits they

provide. A trust:

• Makes it possible for

estate taxes to be

avoided. Because the

trust owns the property

and not you, your heirs

will not inherit in a

traditional sense and it is

often possible to ensure

there will be no death tax

assessed on the property

held in the trust when you pass away. If you are concerned about estate

taxes, it is advisable to speak with an attorney about whether you can prevent

these taxes from being assessed by putting your money into a trust.


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• The probate process can be avoided. When the trust owns your property,

there is no need for your heirs to go through the probate process after you

have passed away. Your beneficiaries can begin benefitting from the trust

more quickly without all the legal

hoops to jump through that are

inherent in the probate process. You

also won’t have to worry about your

personal financial information

becoming court record.

• You have more control over what

happens to money and assets. You

can establish different kinds of trust,

like a spendthrift trust for a

beneficiary who tends to be careless

with money. You name a trustee to

manage the trust for the interest of

the beneficiaries and you can set

guidelines or restrictions. This helps

to ensure that the money and assets in the trust are not wasted or squandered

and that the beneficiaries who receive the gifts you have given them benefit

from the property and assets, rather than being harmed by it.

• You can allow beneficiaries to keep government benefits. If you have a

disabled beneficiary who is receiving Social Security Disability or who is

covered by Medicaid, a large inheritance could result in the loss of

government benefits. A special needs trust allows you to leave money to


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provide a better life for your disabled loved one without interfering with

benefits.

• You can protect the trust assets from creditors and ex-spouses. You can

make sure that the trust assets don’t fall into the wrong hands because the

ownership is not directly transferred to the beneficiary.

All of these advantages mean it makes sense for a lot of people to create a trust.

There are disadvantages, in that trusts can be complicated and a trustee is

required to manage them. However, with the help of an experienced estate

planning lawyer, the advantages should significantly outweigh the downsides and

the trust can be used as an important estate planning tool.


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About Singer Pistiner, P.C.

In the midst of a family crisis, you may feel like you have nowhere to turn. But there is a solution. At Singer Pistiner, P.C., we will help you to find it. As a small firm, we are able to respond quickly to your needs and concerns. The efficiencies of being a small firm also enable us to provide high-quality legal services at affordable rates.

At Singer Pistiner, P.C., in Phoenix, Arizona, we know that divorce is an emotionally and financially taxing experience. That’s why we provide you with a simple, quick and personalized approach to family law services where you will deal with one attorney who will handle your case from start to finish.

Your Personal Attorneys

Throughout the legal process, our lawyers will keep you informed of important developments. We will return your phone calls, answer your questions and address any additional issues that may arise in the course of your case.

We will devote all of the time and effort needed to achieve the best possible outcome. Our law firm can take your case to family court, which is a part of the Superior Court of Arizona, or handle it through another avenue of resolution, such as mediation. In addition to divorce, our lawyers handle paternity, prenuptial agreements,grandparents’ rights, orders of protection, child relocation, and modification and enforcement issues.

In any family law case, your best interests are our overriding concern. Our goal is to find the right solution for you — in an efficient, timely and affordable manner.

OUR FAMILY LAW ATTORNEYS PROUDLY SERVE PHOENIX, GLENDALE, SURPRISE, SCOTTSDALE, TEMPE, CHANDLER AND MESA

If you’d like to know more about how our Phoenix family law firm handles divorce and other family issues, please feel free to call 602-264-0110 or send us an e-mail to schedule a free initial consultation.

Singer Pistiner, P.C. 15849 N. 71st St., Suite 100

Scottsdale AZ 85254 Phone: 602-264-0110

Fax: 602-264-0440 Website: www.singerpistiner.com


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