A Rochester trust attorney provides assistance with creating trusts. Making a trust can be a key part of your estate plan or asset protection plan because trusts are versatile, powerful legal tools that you can put to work to accomplish important goals. Unfortunately, there are circumstances where people make trusts, think their assets are protected, but end up not getting the benefits that a trust could provide them because they have made mistakes with trust creation.
The Law Office of Michael Robinson, P.C. can help to make certain that this does not happen. Our legal team will work closely with you to identify your goals for creating a trust and to discuss the benefits that different types of trusts can provide to you.We can help you to avoid mistakes that could cost you and can help to ensure that your trust is properly created and funded in accordance with the law.
By working with our legal team, you’ll be able to avoid the big mistakes, such as making the wrong type of trust.
What if You Make the Wrong Type of Trust?
If you make the wrong kind of trust, you could face substantial loss. Trusts are created for specific reasons, but if you make the wrong kind of trust, you won’t get the protections that you made the trust in order to provide.
For example, you may decide you want to make a trust to avoid estate tax. If you try to make a living trust, you won’t accomplish this goal. People often believe that a living trust will make it possible not to pay estate tax even if you have a larger estate, since the assets that you transfer to the living trust will not have to pass through the probate process but will instead transfer through trust administration.
However, just because assets can be transferred to a new owner by a process outside of probate does not mean that the assets won’t become a part of the taxable estate. A living trust will do nothing at all to keep your wealth safe from being taxed and if you make this type of trust and don’t realize that taxes will be triggered, you could significantly reduce the value of the inheritance that you are able to pass on to your loved ones.
You could potentially have reduced or avoided estate tax by actually making the right type of trust, but it usually won’t be discovered until after you have passed on that you made the wrong trust type. Obviously, you cannot correct the problem and make the right type of trust at that stage when your mistake was discovered after your death.
This is just one of many examples where a mistake is costly but is not discovered until it is too late to fix the issue. Another common problem happens when a living trust is created with the goal of protecting assets while still qualifying for Medicaid. If you make a living trust, the assets in that trust still count as resources when determining whether or not you are eligible to obtain Medicaid benefits. This means if you need Medicaid to pay for a nursing home, you won’t qualify to get this coverage if you have substantial assets in a living trust.
While other legal tools could have protected your wealth and allowed you to still qualify for Medicaid while maintaining the ability to leave a legacy by passing assets to future generations, you will not get the benefit of these protections. You’ll have no choice but to spend your own money on essential care that Medicaid could have covered if you made the wrong trust type and thus didn’t get the protections you expected.
There are many other circumstances where making the wrong kind of trust could have similar adverse consequences. You should make certain you don’t make a mistake in creating a trust that isn’t discovered until it is too late to correct.
Getting Help from A Rochester Trust Attorney
The Law Office of Michael Robinson, P.C. will help to ensure that you do not make the wrong type of trust. We guide you through all steps of the trust creation process, so to find out more about the ways in which we can help, join us for a free seminar. You can also give us a call at 585-374-5210 or contact us online to if you are ready to get personalized advice on the creation of a trust that will help you accomplish your goals. Call now to get your trust creation process underway.
Latest posts by Michael Robinson, Estate Planning Attorney (see all)
- Medicaid Planning: What Can the Healthy Spouse Keep? - November 15, 2018
- Why Do I Need an Estate Planning Lawyer? - November 15, 2018
- A Look at Asset Protection Strategies - October 22, 2018