2025 To-Do List: Create A Trust
2025 is the year to get organized and protect your biggest asset, your home. Each month I will present a task and why it’s important. This month is creating a trust. When it comes to safeguarding assets, especially real estate, one of the best tools available is a trust.
Here are the key reasons why someone should consider setting up a trust:
Avoid Probate: A trust allows assets to pass directly to beneficiaries without going through the court process known as probate. This can save time, money, and keep things private.
Asset Protection: A well-structured trust can protect assets from creditors, lawsuits, or other financial risks. It helps shield family assets from potential claims against the estate.
Control and Flexibility: You can specify exactly how and when your beneficiaries will receive assets, which can be useful for those who may not be financially responsible or need guidance over time.
Tax Benefits: Trusts can be used strategically to reduce estate taxes, especially for larger estates. Certain types of trusts, like irrevocable ones, may remove assets from your taxable estate.
However, it's essential to consult with a CPA and Estate Planning Attorney before setting up a trust. These professionals can:
Help you determine which type of trust is best for your needs (revocable vs. irrevocable).
Ensure that the trust is structured correctly to comply with tax laws and estate regulations.
Guide you in funding the trust properly, making sure your assets are transferred to it and protected.
Provide personalized advice based on your specific financial and family situation.
In short, while a trust can be a powerful tool for asset protection and estate planning, proper guidance from professionals is critical to ensure the trust functions as intended and achieves the desired goals.
