Trusts are part of estate planning. They serve as a secure holding pen where the trust creator transfers assets that are then protected from certain things like lawsuits. A trust attorney in Orange County will help you create a trust agreement that fulfills your wishes and meets state and federal requirements.
There are different types of trusts and different types of beneficiaries. All of this will be explained to you when you contact a trust attorney for advice.
A trust is a legal arrangement that allows the trust creator to transfer assets to another person who is the trustee. The trustee holds, manages, and administers the assets of the designated beneficiaries. A trust document called a trust deed, specifies the trust terms and conditions for its administration and trust distributions.
Trust beneficiaries are usually children or grandchildren, but they can also be organizations like charities and schools. However, some states restrict the types of beneficiaries allowed. For example, you may not be able to name your dogs as beneficiaries. Consult your Orange County estate planning attorney to ensure that your trust is legally compliant.
There are three types of beneficiaries, these are:
Primary beneficiaries typically include:
Immediate family and close loved ones. For example, a mother, sister, daughter, best friend of 30 years, or exemplary nurse who went out of her way to help you while caught in tragic circumstances.
If you have a minor child when you pass away, their legal guardian manages their inheritance until they come of age.
Talk to your estate planning lawyer for professional advice about naming family and friends with special needs as beneficiaries. It's possible that your good intentions put them in a position where they no longer qualify for government assistance and could end up much worse off than before.
A philanthropic option available to you is a charitable trust. You create a trust whose purpose is to stream income to your preferred charity.
The two most common are charitable lead trusts and charitable remainder trusts.
A charitable lead trust is an irrevocable trust that streams trust income to your nominated charity for a period, for example, seven years. At the end of the period, the remaining assets are distributed to beneficiaries and not the charity.
A charitable remainder trust is an irrevocable trust that streams income to the chosen charity for a period of time. When that period ends, the remaining assets go to the charity and not the beneficiaries.
There are two types of charitable remainder trusts. Charitable remainder annuity trusts (CRATs) donate a fixed amount as an annuity annually and don't allow additional contributions. Charitable remainder unitrusts (CRUTs) donate a fixed percentage of the value of the trust annually and do allow additional contributions.
Many people want to contribute to their place of worship upon their death. It's one last tithe. A tithe is a cash donation to a church that amounts to 10% of property or income. It can also be 10% of your estate.
An estate planning attorney will help you find the best way to carry out your final religious duty by looking at the different types of trusts and determining which option is best for you. For example, you could set up a trust that donates 10% of the value of the trust to the church annually.
You can contribute to your favorite animal shelter or rescue center in a revocable living or charitable remainder trust. You can choose to leave a specified amount of money or resource, for example, all your books for the secondhand bookstore.
You can also go with a residuary option where you leave whatever is left of your estate after everything has been paid and all your beneficiaries are satisfied, to your chosen shelter.
There's also a contingent option should your primary beneficiary not be able to inherit. For example, you leave the remainder of your estate to your brother, but specify that if he doesn't survive you, then 100% of the remainder will to the animal shelter.
A charitable remainder trust fund is also the best way to leave a portion of your estate to your school when you die. You can choose between the two types of charitable remainder trusts, charitable remainder annuity trusts or charitable remainder unitrusts.
For example, you might want a trust that allows you or others to keep making contributions, in which case you need a unitrust.
You may want to contribute to the continuation of your business after you die. As much as you love your family, you know none of them has a head for business, so you want to keep your legacy apart from the rest of your estate planning.
However, business legacies have the potential to be complicated. If you want to be as clear as possible about how you want to leave your legacy, you need to engage an estate planning lawyer who specializes in trusts. They'll help you create a trust specifically for your business's benefit.
Don't leave your estate planning to chance by hiring inexperienced trust lawyers. Choose a firm with experienced trust and probate attorneys in Orange County. Parker Law Offices specializes in all aspects of estate planning, with a special focus on the different types of trusts.
Whatever the size of your estate, let our attorneys help you reach your estate planning objectives. Complete the contact form on our website and we'll get back to you. You may also contact us at 949-867-4818 at Parker Law Offices to book a consultation today!