Florida residents who are creating an estate plan may have heard about the benefits of trusts. As there are many different types of trusts, it is important to understand what they do and who could benefit most from them. For instance, if an individual has a child with special needs, a special needs trust could be a critical component to an estate plan.
This type of document allows a child or adult son or daughter to receive assets from family members. By keeping the assets in a trust, it allows that person to retain access to government benefits such as Medicare. When a married individual dies, it may be tempting to have assets place in an A-B irrevocable trust. However, with the estate tax exemption currently set at $11.18 million, it may be better to simply leave assets directly to a spouse.
However, a trust can be of value to those who inherit assets and want those items to remain separate property. Those who want to support a cause after they die may want to consider a charitable trust. Depending on how it is created, family members or friends may also be able to benefit from assets or the income they generate while in the trust.
There are many issues to consider before individuals decide that trusts are right for them. For instance, it may be worthwhile to consider the cost of creating and overseeing one. In some cases, there may be other methods to meet an estate planning goal that cost less and are easier to make use of. Individuals should also consider whether they want a revocable or irrevocable trust. In some cases, irrevocable trusts are used to protect assets from claims made by creditors.