Law Offices of Frye & Vazquez, P.L.
Call Today. 305-508-5749 | 877-421-5473

Tips for including non-probate assets in an estate plan

Certain types of assets may not be subject to probate, such as contractual designations, but that doesn’t mean that an estate plan can’t address them, along with probate or trust property. Indeed, beneficiary designations of non-probate property like 401(k) plans or life insurance might be titled in the name of a trust. But why would you title a life insurance or retirement policy in the name of a trust, you ask?

There are several reasons. A trust can offer more options than a beneficiary designation. A trust might be set up for specific reasons, such as to provide for medical expenses or an heir’s first home purchase. A trust can also impose an age requirement, ensuring that beneficiaries do not inherit payments when they are too young to understand. 

Such measures of control over how an inheritance is used generally are unavailable with simple contractual arrangements where a beneficiary is named. Typically, such contracts make a lump sum payment when the benefit is triggered.

However, titling life insurance, retirement or other plan assets in the name of a trust might raise complex tax issues, depending on the type of asset and whether the trust was revocable or irrevocable. 

For example, assuming that a retirement plan was transferred to an irrevocable trust, the trustee is technically the legal owner of that asset. The grantor receives a tax benefit during his or her lifetime from the transfer because control is no longer exercised over the asset. If the grantor then receives retirement plans from the trust, a different income tax treatment may be implicated. A law firm like ours that focuses on wills, irrevocable and revocable trusts can help a grantor decide which option is the best fit.

Source: American Bar Association, “Revocable Trusts

No Comments

Leave a comment
Comment Information

What Our Clients Are Saying

  • I have known and worked with Austin Frye and his team since 2008. In that time he has helped serve both my business and personal legal planning needs. From guidance on reviewing and keeping shareholder and state documentation up to date... - Robert
  • It is difficult enough to cope with the emotional challenges of closing a parent's estate, and when you are also faced with the issue of your parents having insufficient documentation, and being remote from your siblings… - Zara L.
  • Austin Frye provided legal services to my father while alive and to his estate after his death; when showing the EP docs his firm prepared to other professionals (lawyers, financial advisors, accountants)… - Mark S
  • I've been a client of Austin Frye's for over 10 years. In that time, he's handled my estate/trust planning and asset protection as well as complicated business deals. - Leslie
  • Mr. Frye recently set up a complicated special needs trust for my son and, as usual, did a great job explaining it and in putting our minds at ease about our son's future well-being. - Dr. Howard
Read More...
  • NYSBA
  • Massachusetts Bar Association
  • The Florida Bar 1950
  • CFP
  • Florida Bar Elder Law Member
  • Academy Of Florida Elder Law Attorneys
  • Florida bar Business law Member
  • NAELA National Academy of Elder Law Attorneys, Inc.
Email Us For a Response

Contact Us For Personal Attention To Your Legal Matter

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Office Location

Get In Touch With Us
20900 W. Dixie Highway
Aventura, FL 33180

Toll Free: 877-421-5473
Phone: 305-508-5749
Map & Directions