Trusts are one of the most popular estate planning tools because they can accomplish very specific goals. You’ve probably heard of revocable and irrevocable trusts, which are the most common. There are actually many other types of trusts that can be created to handle special circumstances. Here are a few potential reasons to create special trusts.
Care for Pets
Any dedicated pet owner understands that pets are just as important as children. Likewise, you may want a special pet trust to ensure that your pets are cared for in case you become incapacitated or deceased. Pet trusts can include appointment of an individual to manage and disburse funds and designating someone to care for your pets.
If you own multiple firearms, you may want to consider a gun trust. Federal and state laws are very strict about gun ownership and transfers. Any firearms that you own would normally go through the probate process. By creating a gun trust, firearms are technically owned by the trust and can be more easily transferred upon your death, outside of probate. Just remember that any beneficiaries of a gun trust must have the necessary permits to legally own firearms.
Include Special Incentives
Perhaps you don’t want beneficiaries to receive money from your estate until they have accomplished certain milestones in life. A special incentive trust can help you accomplish that. You can make disbursement of funds contingent upon almost anything (so long as it’s legal). Examples are: completing an undergraduate college education, getting married, or abstaining from certain activities. You’ve probably seen references to such conditions in the movies.
Other Reasons to Create Special Trusts
These are just a few common reasons to create special trusts. There are many other possible reasons to create special trusts, such as:
- Supplemental needs for the care of a disabled dependent without disqualifying that dependent from public assistance.
- Transfer of a personal residence while you are still living.
- Retirement trusts for management of inherited retirement funds.
- Gifting trusts to extend usage of annual gift tax exclusions.
- Blind trusts to retain privacy.
- Funeral trusts for payment of funeral expenses.
To learn more about special trusts and whether they are a good solution for your needs, contact our team to schedule a consultation. We will review your personal information and goals and provide helpful recommendations on trusts and other estate planning tools to help you achieve them.