Utilizing trusts is a common piece of estate planning advice, especially for those with a large number of assets to pass along. However, many people in Florida are unclear about how trusts work and what the benefits might be for using them. Since there can be some cost involved in setting up a trust, it is a good idea to fully understand the benefits and understand if they apply to one’s particular case before jumping in.
Here are some of the benefits of using a trust:
- Protecting privacy: All assets in an estate that go through probate become public record. Therefore, a person who wishes to keep their assets private may find a trust to be a helpful tool.
- Lowering the tax burden: This benefit is particular to those whose assets exceed the exemption level for estate taxes. Moving assets out of an estate and into a trust is often a wise decision for those with significant wealth because it can lower the tax burden for the beneficiaries.
- Save time and expense by avoiding probate: The probate process can often be time-consuming, if not altogether difficult. Many people are interested in cutting down on the number of assets that need to go through probate. In these cases, a trust can be a welcome reprieve.
Although there are many benefits, one potential drawback to trusts can be the process of setting them up. It is important to be careful when undergoing that process, to ensure the setup is correct and all the benefits and intentions for the trusts are properly secure. Working with a Florida estate planning lawyer is an important step that can help make sure the trust aligns with state estate law.