Though wills are the cornerstone of any estate plan, trusts are also incredibly important documents that can help beneficiaries avoid excessive taxation on the decedent’s assets and can also help those who create trusts address non-tax-related goals while they are alive. Contact a Fayetteville, Arkansas trusts lawyer from the Knapp Law Firm today to learn more about how our legal team can help you through the legal process ahead.
Should I Hire a Fayetteville Trusts Lawyer?
Any estate planning document should be carefully crafted by a competent and seasoned Fayetteville, Arkansas estate planning lawyer. When estate planning documents are improperly drafted, it can have drastic implications on a person’s estate in the long run. No matter your financial situation, you have a lot at stake when it comes to properly drafting a trust. Don’t leave the future of your estate to chance.
Different Types of Trusts in Arkansas
There are several different trusts available to people in Arkansas, and the trust that’s right for you will depend on your specific circumstances. Just some of the most common trusts are as follows:
- Revocable Trusts: Essentially, a revocable trust is when a person places their assets in a trust, and those assets are to be managed by a trustee. The person who creates the trust is known as a grantor, and the person who manages the trust is known as a trustee. In some cases, the grantor and trustee can be the same person, but typically, the trustee is a trusted family member, such as a spouse, parent, or child. Essentially, the trustee’s job is to manage the assets in the trust according to the grantor’s best interests. When a grantor dies or becomes incapacitated, the trustee will distribute assets held in the trust in accordance with the trust agreement. Grantors also retain the right to terminate or modify revocable trusts if need be.
- Irrevocable Living Trusts: Irrevocable living trusts, such as testamentary trusts, provide certain tax protections for your estate. However, once you sign over an asset in an irrevocable trust, the asset no longer belongs to you and instead belongs to the trust and is under the control of the trustee.
- Special Needs Trusts: These types of trusts are ideal for those who receive government benefits for certain physical or mental disabilities, such as Medicaid. Creating a special needs trust will allow a disabled person to receive supplemental funds without relinquishing their right to continue receiving government benefits.
Irrevocable Life Insurance Trusts: If you own a life insurance policy, you can create an irrevocable life insurance trust to separate the proceeds of your life insurance policy from your taxable estate. When you pass on, the proceeds will become available to your beneficiaries income tax-free.
Contact a Trusts Lawyer Today
If you would like assistance drafting up a trust that best suits your financial needs, we are here to help. All you need to do is contact an experienced Fayetteville, Arkansas trusts lawyer from the Knapp Law Firm today.