What are the Benefits of Having a Trust in Arizona?
By Zachary Mushkatel on October 1, 2019
Many people think trusts and Wills are the same thing, but they are not. In fact, trusts can provide many benefits that Wills cannot provide, including making life much easier for your family after you pass away. There are many things to know about trusts such as the different types and the specific procedure to follow when creating one. If you are interested in creating a trust, it will be important for you to speak with an experienced Arizona estate planning attorney at Mushkatel, Robbins & Becker, PLLC.
Do I Need a Trust?
Many people think you must be wealthy in order to have a trust, but that is simply not true. For many people, a trust is an effective tool when planning an estate. However, due to the expense of opening one, those that do not have a great amount of assets which they would like to protect may not necessarily need one. The general rule of thumb is that if you have at least $100,000 and substantial real estate property, you should consider creating a trust.
Benefits of Having a Trust
When many people think of establishing a trust, they often think of only the tax-planning benefits. While this is one of the biggest benefits of a trust, many others exist as well. These benefits include:
- Asset protection – One of the main benefits of trusts is that they help to protect your assets. When assets are transferred into a trust, they are no longer a part of a person’s property. So, if you fall into financial trouble, those assets cannot be seized.
- Confidentiality – Wills are a matter of public record and, as such, anyone that wants to see what is in your Will can do so. Trusts, on the other hand, are completely confidential. The only people that will ever know what is placed into a trust are you and those that you trust with that information.
- Estate planning – Many people wish to pass on an inheritance to their loved ones, but they don’t just want to give it to them outright. For example, money that you want your loved one to use for his or her education may be made unavailable to that person until he or she gets accepted into a college or university. A trust can allow for those types of provisions.
- Family business – Many people that have spent much of their lives creating a business do not want to think about it being liquidated after their death. If the business is placed into the trust, it will protect it against unnecessary liquidation.
These are just a few of the benefits that come with trusts. An estate planning attorney at Mushkatel, Robbins & Becker, PLLC, can explain even more benefits to you in greater detail in a free and confidential consultation.
Types of Trusts
The two main types of trusts are revocable and irrevocable. Revocable trusts are created during the lifetime of the person who created it. These trusts can be changed, modified or revoked at any time. Irrevocable trusts, on the other hand, cannot be changed once they have been created. For example, if property is placed into a trust, no one can gain access to that property – not even the person that placed it into the trust. Other types of trusts include:
- Asset protection trust – This type of trust is intended to protect a person’s assets from creditors.
- Charitable trust – This trust can benefit a particular charity or the public. This type of trust offers tax advantages.
- Constructive trust – This is a type of trust that was never officially created. However, a court has established that it exists based on certain factors and circumstances.
- Special needs trust – This trust manages the assets of a person while still allowing them to receive any government benefits which they are entitled to receive.
- Spendthrift trust – This trust protects assets from being sold by the beneficiary once they are received.
- Tax bypass trust – This type of trust limits the amount of federal estate tax that must be paid after the death of a second spouse.
With so many different types of trusts, it can be difficult to know which one is right for you. Our estate planning attorneys can explain all of your options in detail and help you to make the right decision for your situation.
How to Create a Trust in Arizona
Creating a trust typically involves the following steps:
- Decide on the type of trust you want to set up.
- Take inventory of your property and decide what you would like to put into the trust.
- Select a trustee, which can be you or someone else. If you decide to name yourself as trustee, you should also name a successor trustee that can take control of the trust upon your death.
- Speak with an attorney that can help you to create the actual documents for the trust.
- Sign the documents in front a notary public.
- Fund the trust by transferring property into the trust. This step involves a great deal of paperwork.
While creating a trust in arizona can be broken down into these simple steps, the process actually tends to be much more complicated. So, you will benefit from hiring an attorney that can guide you through the process.
Get Help from an Experienced Phoenix Estate Planning Attorney
An estate planning attorney can help you to determine what type of trust you need to meet your objectives and take care of all of the paperwork related to it. The attorney will also look at your entire estate plan and advise you on what other items you should consider including in your plan. If you need help with establishing a trust, creating a Will or any other aspect of estate planning, contact the experienced attorneys at Mushkatel, Robbins & Becker, PLLC. We can help you to create a solid estate plan that will protect your future and your loved ones. We offer free consultations for clients in Sun City, Surprise, Peoria, and Glendale. So, contact us today.
Zachary Mushkatel is an Arizona native who earned his undergraduate degree from the University of Arizona in 2001 and his law degree from the University of Minnesota Law School in 2004. After serving as a public defender, he entered into private practice and, ultimately, joined forces with Mathis Becker to form the law firm known today as Mushkatel, Robbins & Becker, PLLC. In addition to criminal law, Mushkatel practices civil litigation, with a focus on estate litigation and personal injury cases. He also serves on the Board of Directors for the Surprise Regional Chamber of Commerce and Sun Valley Lodge, and he is an executive officer and member of the Board of Directors for the West Maricopa County Bar Association.