A testamentary trust can be an exceptionally useful tool for many people trying to plan their estates. However, it is not necessarily appropriate for everyone, and you should consider the benefits carefully, with the guidance of an experienced attorney, to see if it works for you. Here are five benefits of a testamentary trust you should consider:
- You can put your property in the hands of someone you trust
- One of the biggest advantages to a testamentary trust is that the property will be managed by a trustee, someone designated by you to watch over the property on your behalf when you pass away. This trustee then has a responsibility to ensure the property in the trust is properly managed. This way, you know anything you place in the trust will be properly taken care of when you pass away.
- You can plan for the management of assets for minors or other dependents
- A testamentary trust is also excellent for managing property on behalf of minor children or other dependents. Since minors cannot manage property themselves, a trustee can keep it safe for them, and ensure it is appropriately managed and invested as appropriate. This way you ensure that their inheritance will be safe for them when they become of age.
- Testamentary trusts are protected from many taxes
- Another major advantage is that the assets held in a testamentary trust are protected from many types of taxes. For example, money and property passed down through a will may be subject to estate or gift taxes, depending on the amounts involved. The assets held in the trust, however, will be largely exempted from that, saving more of it for your beneficiaries.
- Creditors cannot easily access property held in a testamentary trust
- If you owe any money to anyone when you pass away, they will almost certainly attempt to have their debts satisfied by suing your estate. Normally, it is difficult to stop creditors from satisfying their debts from an estate with assets, but a testamentary trust can protect against this scenario. Typically, creditors cannot access assets held in a trust, meaning that your estate remains safe.
- Property in a testamentary trust is non-probate
- Finally, any property held in a testamentary trust is considered to be non-probate. This means that the property avoids much of the normal probate process, and can be transferred over to your beneficiaries easier. However, the best way to see if a testamentary trust can help you is to speak to a lawyer with experience handling estate law matters.
Whether for yourself or for a loved one, estate and elder law planning can be overwhelming and emotionally taxing. The legal professionals at Hobson-Williams, P.C. will advise you on the options available to you, and help you establish a plan that best suits your needs. Call (718) 210-4744 or visit our contact page to speak to one of our attorneys and learn how Hobson-Williams, P.C. can help you gain the peace of mind that comes from being prepared for the future.