Property ownership is not the only reason a person might want to create a trust instead of a will. In fact, you do not have to own property to create a trust which in some instances could be the smarter estate planning choice. In addition to naming who will receive your assets after you pass, a trust allows you the flexibility to:
- Reduce the amount of estate and gift taxes your loved ones may have to pay after you pass away
- Eliminate the need for your estate to go through the probate process
- Protect your assets from lawsuits and creditors
- Specifically name a person (trustee) to manage your assets if you become incapacitated as well as after you pass away
There is not a singular type of trust – in fact, there are many different types that can provide taxation benefits for your loved ones. For example, you can create a generation-skipping trust to leave tax-free money to your children and grandchildren, a credit-shelter trust to leave the maximum tax-free amount to your children and the remainder to your spouse, an irrevocable life insurance trust to remove life insurance from your taxable estate and allow your heirs to pay estate taxes with that money – and many other types of trusts.
The best way to approach creating a trust is by contacting an estate planning lawyer to discuss your current situation, your plans for the future and then learn the best options for you.
To learn more about creating trusts in Colorado, contact the Denver trust attorneys at Brown & Crona, LLC. Contact us at (303) 339-3750 or send us a message online to meet with our experts.