False – Your net worth is only one factor to consider when deciding if you need a Revocable Living Trust. There is a multitude of reasons why you should consider creating and funding a trust that has nothing to with your net worth: You have minor children and naming a trust as the beneficiary of your life insurance or retirement accounts will keep these assets outside of probate and a court-supervised guardianship. Your own real estate in two or more states and a trust will help your loved ones avoid two or more probate administrations. You want to create a disability plan that will keep you and your assets outside of a court-supervised guardianship. You want to give your loved ones essentially immediate access to your property after you die instead of waiting weeks or even months for access through the probate court. You want to keep your financial matters and the identity of your beneficiaries private after you die. Only you, in conjunction with your estate planning attorney, can determine if a Revocable Living Trust is right for you, regardless of your net worth.
I have taught Estate Planning, Business Law, Business Organizations, and Trusts at various local schools, including Rollins College and Valencia Community College.
Limited Liability Companies
FALSE – A Revocable Living Trust does nothing to protect your assets against lawsuits for two reasons: (1) You can change the terms of the trust at any time and put assets in and take them back out, and (2) You still personally own the assets titled in the name of the trust. Asset protection planning involves an analysis of your long term financial and estate planning goals and then positioning or re-positioning your assets to be exempt from creditors’ claims. Depending on the laws of your state, this could include investing in a primary residence, life insurance, retirement accounts, annuities and/or limited liability companies; titling assets in one spouse’s name or as tenants by the entirety; and/or setting up one or more irrevocable trusts. Unfortunately, a Revocable Living Trust can’t shield your assets from the claims of creditors – you’ll need to create a comprehensive asset protection plan in addition to your trust.
Carol is a Probate and Estate Planning Paralegal. She has a diverse employment history, including serving in the United States Air Force where she was an aircraft electrician, and then transitioning into private industry at Martin Marietta where she worked as a quality engineer on the Patriot Missle System. She also ran a print shop, was an editor for a legal publishing company, and worked for a court reporting firm. She’s an excellent proofreader.
Wills
A Last Will and Testament allows you to communicate your wishes and make things easier for the people you leave behind. Creating a Last Will and Testament as a part of your estate plan will ensure all you leave behind, including the care of your children, will be taken care of according to your wishes. Use a Last Will and Testament if...
Trusts
These trusts are ideal for protecting children, heirs, or other family members who have special needs, specifically those who currently receive or may potentially receive government benefits. Special needs trusts – sometimes known as supplemental needs trusts – can create a structure that allows you to pass on assets to someone with special needs without hindering their ability to qualify for government benefits such as Medicaid coverage or Supplemental Security Income (SSI). Distributions from the supplemental needs trust are designed to supplement the beneficiary’s public benefits, not supplant them.
Power of Attorney
Trusts have been used for centuries. Use of trusts today is even more important considering estate taxes as well as probate. The use of trusts gives the Trust creator (“Settlor”) great flexibility in avoiding estate taxes, protecting assets and distributing assets in tax-preferenced ways. During the construction of your trust(s), there are several other instruments that will be integrated in the planning process. The Health Care Proxy, Power of Attorney, Living will and Pour over will are just some of the ancillary documents that should be created along with a trust. Some of these are critical in controlling your assets should you become incapacitated. But before you die. In the past, many trusts were constructed to take advantage of each spouse’s “exclusion amount”, but with the new tax laws, each person’s taxable estate may reach $11,580,000 before it becomes subject to estate taxes. And, with portability (the ability of the first-to-die spouse to give his exemption to the surviving partner), a couple today can pass an estate worth $10,680,000 tax-free to their heirs. Prior to these tax law changes many revocable living trusts were established as AB or ABC trusts with and without disclaimer rights and/or powers of appointment granted to the surviving spouse. While these types of trusts can still be desirable, they are no longer always necessary if planning mainly to minimize estate taxes. If you are the beneficiary of one of these older trusts, be assured that we are well versed in dealing with any trust structure and can help you administer your trust efficiently and economically.
A frequent speaker on Estate Planning, Wills, and Probate before various groups, including Disney World, AARP, City of Orlando, Orange County, Orlando Utilities Commission, Federal retirees, and other civic and church groups, I have also taught at state-wide continuing legal educations seminars for Florida attorneys on Estate Planning, Real Estate Tax Planning, and Drafting Wills And Trusts.