Types of Trusts Created by San Francisco County Trusts Lawyer

There are two broad categories of trusts, Testamentary and Intervivos and a San Francisco County Trusts lawyer can help you with either. A Testamentary Trust does not take effect until death, and is typically contained in a Will. An Intervivos Trust goes into effect while you are still living, and your assets must be transferred to the Trust once it has been established. It is important to have a Will along with the Intervivos Trust to make sure that any assets that were not transferred to the trust prior to death will be transferred to the Trust by the Will, if that is your desire.

Probate proceedings are not required for an Intervivos Trust. Since the Trust is not filed with the Court, privacy is maintained regarding the terms of the Trust and the Trust assets. The fees associated with Post-Mortem Trust administration are generally lower than the statutory fees associated with probating a Will.

Trusts do not “eliminate taxes”, but it is possible to minimize your estate tax liability through estate planning.

Types of Trusts: An Overview

• Living trusts, also called family trusts, are created during the person's lifetime to avoid taxes, for property management, or for financial advantages. The objectives of living trusts are to avoid San Francisco probate, minimize taxation, and preserve financial privacy.
• Revocable trusts can be revoked or changed while the trustor (the owner of the trust) is still alive. Consequently, the trust remains part of the person's estate and may be taxed. However, after death the trust becomes irrevocable and property is passed on to heirs.
• Irrevocable trusts typically cannot be altered or revoked after they are created. Such trusts offer tax advantages that revocable trusts do not offer. Insurance trusts, charitable trusts, and trusts for children are common examples of irrevocable trusts.
• Testamentary trusts are created by the person's will and goes into effect when the person dies. Such trusts often address assets that are accumulated during the person's lifetime and also generated by the person's death, such as life insurance policy proceeds or a wrongful death settlement.
• Married A-B Trusts, also called a bypass trusts, go into effect when one spouse dies. The trust divides into two trusts at the time of death to benefit the surviving spouse through an estate tax exemption and marital deduction. The deceased spouse’s assets are transferred into the bypass trust and based on how the trust is structured, the surviving spouse may use income generated from assets to pay for certain living expenses. When the second spouse dies, assets in the bypass trust can be passed on to other beneficiaries, sometimes doubling the amount of assets which pass to heirs free of estate taxes.
• Qualified Terminable Interest Property (Q-TIP) Trusts qualify for the unlimited marital deduction, meaning the surviving spouse may receive assets without having to pay estate taxes when the first spouse dies. This type of trust also allows assets to pass to heirs after the surviving spouse dies.
• Special needs trusts for disabled beneficiaries are set up to provide for mentally or physically disabled beneficiaries with property that is held by the trust. A trustee manages financial affairs on their behalf. The trust may be structured so the disabled are still eligible for and receive basic government disability benefits.
• Generation-skipping trusts are trusts that qualify beneficiaries for the generation skipping transfer tax exemption. This exemption usually avoids estate taxation for the beneficiaries of that generation.
• Qualified Personal Residence Trusts (QPRT) allow a person to gift their house through a QPRT at a low gift tax value to a beneficiary for the use of the home during their lifetime. The QPRT avoids estate tax.
• Pet trusts provide for the pet's care after the owner becomes unable to do so due to death or incapacity. The trust may exist for the life of the pets.

Trusts Lawyer in San Francisco County

Linda Ross Myers is an experienced San Francisco County trusts lawyer. Consultations are confidential and at no obligation. Call 415-230-5347or contact her online today.