There are many reasons why people in New York may consider a trust when it comes time to plan for the future. Estate planning may help people to achieve a number of their goals for their loved ones, from simply distributing property and assets to protecting them from estate taxes, providing funds for children, designating money for specific purposes or donating to charity. Estate planning can also encompass planning for health care and financial decisions to be made when a person is incapacitated and designating a trusted person to handle these key issues. There are certain documents almost everyone should have, including a will, health care proxy and powers of attorney.
Many people may not have considered establishing a trust, but it can provide meaningful benefits for a wide range of families. After a person dies, their estate goes through probate to distribute their assets as specified in the will. While this process is typically not too complex for people with modest estates and no contesting heirs, it can take more time and money to handle the probate process than with non-probate transfers. Some types of assets already pass without probate, like life insurance proceeds, accounts with named beneficiaries and jointly owned property with rights of survivorship. Trusts can allow all property to also transfer without probate.
There are different types of trusts, many of which offer more benefits than the opportunity to avoid the probate process. Trusts can also introduce greater amounts of flexibility and control into the estate planning process, and some types of trusts can also help to reduce tax burdens.
When thinking about the future, people may want to consider trusts (revocable and irrevocable) to maintain their privacy and provide greater protection for their beneficiaries. An estate planning attorney may offer advice and guidance on how trusts can fit within a person’s overall plan.
