Estate Planning Starts With Wills And Trusts
It is never too late – or too early – in life to start protecting your assets with proper estate planning tools. The law firm of Johnson, Carroll, Norton & Kent P.C., in Evansville, Indiana, offers a full range of estate planning services for individuals, couples and families throughout southwestern Indiana.
Do You Need a Will?
A concise, legally executed will is the only certain way to make sure your final wishes are carried out regarding the disposition of your assets following your death. If you die without a will (intestate), your surviving family members will be left in a position of leaving your estate assets to the decision of the court. While most assets will pass to the surviving spouse or children, the courts may face challenges from individuals, such as step-children from a previous marriage, who file litigation seeking a share of the assets. When a will is properly drafted and up to date, your assets will be distributed to the family members or charities you name, according to your terms and conditions.
We can also help you establish your final wishes through instruments such as:
- Living will: To make sure your loved ones know your wishes regarding end-of-life issues and health care needs
- Powers of attorney and guardianship: To give specific loved ones the authority to make legal, financial and medical decisions for you, in the event you become incapacitated
- Medicaid planning: To protect your family’s assets from the high cost of nursing home and long-term medical care
What Is A Trust?
Many people wish to leave their assets to their children, relatives or charitable organizations according to a predetermined distribution plan. Trusts allow you to place a predetermined amount of financial assets into a fund, thereby removing it from your holdings for tax purposes. You set up the terms of withdrawal from the account, including the specific persons or organizations who may share in the distribution, as well as the exact terms of the distribution. You will name a trustee to oversee the terms and conditions of distribution and funding of the trust. Trusts may be set up to begin distribution during your lifetime or upon your death.
Revocable or Irrevocable Trusts
Trusts may be revocable, meaning you may terminate the trust and reclaim the assets. Trusts may also be irrevocable, meaning that you cannot terminate the trust or change the trust terms. With either type of trust, taxes on the earnings will be deferred while the money is held in trust until withdrawn by beneficiaries for distribution.
Some common types of trusts include:
Living Trusts: Allows you to oversee the distribution of assets to your children and other beneficiaries while you are alive.
Testamentary Trusts: The terms of the trust to not take effect until the death of the estate holder who established the trust.
Qualified Personal Residence Trust: Allows you to put your personal residence in a trust fund for tax benefits, but continue to live on the property until your death.
Charitable Remainder Trusts: Allows you to place your property or assets in the name of a trustee of your choosing, while you receive a specified amount or percentage of the trust assets each year. Upon death, the remaining property in the trust belongs to the qualified charitable organization. You would benefit from a significant tax deduction received at the time the trust is established.
Charitable Lead Trusts: Allows you to donate a portion of your assets for use by a qualifying charitable organization, in order to reduce your taxable income. You do not retain control or property or earnings from the assets. After a predetermined period of time, the remaining assets/earnings in the trust will be distributed among your named beneficiaries.
Special Needs Trusts: Lets your family continue to provide for the security and welfare of a loved one with special needs, even after you are deceased or incapacitated.
There are many specific types of trusts that you can establish within the broad categories. Some of the more common trusts include:
- Asset Protection Trusts
- Credit Shelter Trusts
- Charitable Trusts
- Complex Trusts
- Dynasty Trusts
- Generation-Skipping Trusts
- Grantor Trusts
- Grantor Retained Income Trusts (“GRIT”)
- Life Insurance Trusts
- Qualified Personal Residence Trusts (“QPRT”)
- Revocable Trusts
- Special Needs Trusts
Contact Us To Learn More
Our attorneys have extensive experience helping people establish their estate planning goals. Johnson, Carroll, Norton & Kent serves families in Vanderburgh, Posey, Gibson and Warrick Counties. Call 812-205-2661 or contact us online to arrange a consultation. Our law office is located in Evansville, three blocks off the Lloyd Expressway, with ample parking and first-floor accessibility.