Illinois Estate Planning and Elder Law Blog
In the November 2015 issue of Kipplinger’s magazine, an article points out that it is common for families to distribute assets through the use of trusts, which come in more flavors than Jelly Belly jelly beans.
Trusts can minimize estate taxes, protect assets from mistakes of heirs or avoid probate keeping information private.
A revocable living trust allows the creator to maintain control over the assets while he is alive. This type of trust avoids probate, and if a husband and wife put revocable living trusts in place, they can include credit shelter provisions which allow each of them to use his/her Federal Estate Tax Exemption ($5.43 million in 2015) thereby passing over $10 million free of Federal Estate Tax.
Asset protection trusts can be used if there are concerns about the spending habits of beneficiaries. This type of trust protects beneficiaries from creditors, bankruptcy and future ex-spouses because assets belong to the trust, not the beneficiary.
A personal message by the trust creator included in the trust often makes an otherwise impersonal document far less sterile. A story behind family heirlooms can be included, or the trust creator can express why he values education or entrepreneurship.
Consult your estate planning attorney for further information.