Posted by Zach Dana on December 29, 2016
Setting up a trust has been a popular estate planning tool, especially if you want to leave properties and assets to your loved ones without the hassle of undergoing the probate process. In a trust, the creator or trustor transfers his property under the care of a trustee, who can be a trust lawyer, in favor of the beneficiary.
Another reason why setting up a trust arrangement is seen as advantageous is the fact that it lowers the estate taxes that your estate would need to pay before the properties can be distributed to the heirs. Since properties held in trust are no longer part of your properties, then they are no longer part of the universal properties to be subjected to estate tax.
Moreover, the trust allows you to dictate the schedule of distributing the inheritance to the heirs, which a will does not allow.
But setting up a trust is not just a walk in the park as it may sound. There are many aspects of a trust document that can be overlooked which may lead to adverse consequences.
Also, questions as to the nitty-gritty of a trust agreement cannot simply be answered by searching online. There are certain topics that can only be clearly answered by someone who has the experience dealing and executing an actual trust document.
To assist you in setting up a trust, a trust lawyer is needed who can provide meaningful legal help to the trustee, the person who is in charge managing the trust. As mentioned above, you can even name a lawyer as the trustee, which can be helpful in cases where the estate is large and complex.
However, the role of trust lawyer is not only confined with the creation and administration of the trust.
The trust lawyer is also held responsible for drafting an effective plan for the protection and distribution of the properties of the trustor after his death so as to maximize the benefits that the beneficiaries may receive. The trust attorney’s tasks also include drafting documents intended for the protection of the assets against lawsuits and taxes.
The first thing that a trust lawyer must do at the start of the engagement is to make a plan based on the needs of the client. The plan is based on the economic and financial circumstances of the client as assessed by the trust lawyer her or himself.
The trust lawyer must also evaluate whether the client is married or not, the number of children, as well as incapacity issues that may be relevant as to the terms and conditions of the trust. Oftentimes, the trust lawyer will have a set of questions to be answered by the client.
After acquiring the pertinent information needed, a trust lawyer mainly works on four documents—last will and testament, living will and advance directives, power of attorney and various other trusts.
In the execution of a last will and testament, the trust lawyer is expected to make sure that formalities applicable to wills are complied with to secure the validity of said will. Moreover, the trust lawyer must also review to ensure that the will addresses concerns as to the division and manner of distribution of properties.
A trust lawyer is also needed in the preparation of a living will, a document that specifies the client’s intentions pertaining to the medical procedures and care they intend to receive in times of incapacity. The expertise of the trust lawyer is called for in the making of living will since its legal requirements vary from state to state.
Whereas the living will and advance directive concern health care decisions, the power of attorney is the document executed concerning financial arrangements.
A requisite condition before the power of attorney is deemed effective is the judicial declaration of a person’s incapacity. It is therefore incumbent upon the trust lawyer to secure this requisite before the power of attorney can be permitted.
As to the execution of trust, it is upon the wisdom of the trust lawyer to determine the type of trust you have to execute that is suitable to your own needs. The trust document to be executed will specify the rules to which the trustee shall abide.
Choosing the proper trust is thus very important. There must be some strike of balance between the objectives of the client and the various statutory provisions governing the many variations of trust. It can become more complex, however, if the trust lawyer is expected to deal with a large estate.
If you need an expert attorney to help you with a trust, reach out to us. We are here to help.