Creating Your Trust

What, exactly, is a Trust?

A Trust is a unique estate planning tool. The word "trust" can mean the actual document that creates the trust, or it can refer to the abstract entity that holds your estate. Conceptually, think of a Trust as a combination of a corporation and a will. The Trust becomes a third person, similar to a corporation, but is controlled by you, just like a will. You can designate the beneficiaries, you can control the distribution, and you can maintain control over the assets for as long as you live. The only difference is that the assets are now owned by the Trust and not you, as an individual. That does not mean, however, that you lose control over your assets. Depending on the type of trust you create, you can still control everything by designating yourself as both a trustee and a beneficiary. If you do not fully understand this concept, don't worry. We can explain this in more detail when we meet to discuss your options.

Why are people using Trusts?

Trusts have always been available, but they have become increasingly popular in recent years. The biggest advantage of creating a Trust is to avoid probate. Almost every estate must be "probated", or distributed and closed through a court process. This process can take months, or even years. When that same person who has their assets in certain types of trust will not have his or her estate taken through that process. Note, however, that this does not prevent the beneficiaries from the Pennsylvania Inheritance Taxes and/or any Federal Inheritance Taxes which may be applicable. If you are looking to strategically plan for taxes or to minimize your tax liability, a trust may be used, depending on the situation. We can assist you in your tax planning efforts!

I am afraid to create a trust because I heard I would not have control over my estate?

This is not necessarily true. Depending on the type of trust you create, your assets may very well remain under your control right through until your death. Sometimes, however, there are advantages to putting some assets into a trust where you have no control. You can still decide who will benefit from such a trust, and there are also a significant number of tax advantages as well. However, if you want to create a type of trust that remains under your control, we can do that too! That type of trust is called a Revocable Living Trust. It is revocable and allows you to have as much or as little control as you may desire. We can show you how this is done, and help you decide whether a trust is right for your situation.

"Where there's a WILL, there's a way!"
"TRUST your estate!"