Trusts in Estate Planning
Revocable and Irrevocable Trusts ● Dynasty Trusts ● Living Trusts
There are as many different types of trusts are there are goals people are seeking to achieve through the use of a trust. The primary differences between these many types of trusts: the tax consequences for the donor and the degree of control the donor has over the assets held in trust.
Among the goals that a trust can accomplish:
- Minimizing personal taxes while you are alive and estate taxes for your heirs
- Avoiding Illinois probate
- Funding an education
- Caring for an elder or disabled family member
- Protecting family assets
- Controlling the timing of distribution of assets
- Leaving a charitable legacy
If you are considering a trust as part of your estate plan or tax plan, contact attorney Denice Gierach at the Gierach Law Firm in Naperville, Illinois. Learn more about how a trust can fit into your estate plan, and which trust is right for you.
The Tax Consequences of Trusts
Both revocable and irrevocable trusts can have positive tax consequences, minimizing or deferring taxes on your assets. A revocable trust gives you, the donor, more control over your assets in the trust, but in exchange it offers less favorable tax treatment. An irrevocable trust gives control to trustees in exchange for more favorable tax considerations.
Putting Your Goals First
- Maximizing assets: Irrevocable life insurance trusts (ILIT) are an excellent option for funding a trust for family members or dynasty planning
- Providing for vulnerable adults: Supplemental needs trusts (special needs) or Miller trusts can be used to provide for the needs of elders entering a nursing home and concerned with Medicaid eligibility
- Transferring assets to family: Almost any type of testamentary trust will work for this purpose. Allow us to explain the benefits of a Qualified terminable interest property (QTIP) trust, a Qualified Personal Residence Trusts (QPRT), or a dynasty Trust
- Charitable trusts: A trust can allow you to have a lasting impact on the community with family foundations, charitable family limited partnerships, charitable trusts
- Trusts as part of business succession planning: Consider a family limited partnership (to minimize taxes) or a discount family limited partnership
Skillful Legal Advice for Sensitive Family Matters
The immediate distribution of significant assets is not always in the best interest of beneficiaries, particularly those who are quite young or those with physical or emotional impairments. Ms. Gierach can help you establish a dynasty trust to enable incremental disbursements. A dynasty trust can include incentive provisions for children to finish school, to remain married, keep the a family business, or to comply with other conditions (also called incentive trust).
Contact an Illinois Estate Planning Attorney
To learn more about how a trust may work to meet your goals, contact the Gierach Law Firm for skilled legal help.