{"id":979,"date":"2018-08-10T16:39:05","date_gmt":"2018-08-10T16:39:05","guid":{"rendered":"https:\/\/scrantonfg.com\/?p=979"},"modified":"2018-08-27T15:53:14","modified_gmt":"2018-08-27T15:53:14","slug":"an-introduction-to-trusts","status":"publish","type":"post","link":"https:\/\/scrantonfg.com\/an-introduction-to-trusts\/","title":{"rendered":"An Introduction to Trusts"},"content":{"rendered":"

[vc_row][vc_column][vc_single_image image=”843″ img_size=”full” alignment=”center”][vc_column_text]<\/p>\n

You may think trusts are only for wealthy people, but that’s not necessarily the case. A properly constructed trust can serve many purposes for families of more modest means. A trust might help avoid the time-consuming and costly probate process, maintain control of a legacy for your heirs, provide for a dependent with special needs, or make a substantial contribution to your favorite charity.<\/h2>\n

Legal Control of Assets<\/h2>\n

A trust is a legal arrangement in which one person or institution controls property given by another person for the benefit of a third party. The person giving the property is referred to as the\u00a0trustor<\/em>\u00a0(or\u00a0grantor<\/em>), the person controlling the property is the\u00a0trustee<\/em>, and the person for whom the trust operates is the\u00a0beneficiary<\/em>. With some trusts, you can name yourself as the trustor, the trustee, and the beneficiary.<\/p>\n

Although you may be hesitant to give up control of your assets, in some cases it might be worthwhile to choose an independent trustee who would be subject to strict legal requirements in administering the trust.<\/p>\n

Testamentary vs. Living Trusts<\/p>\n

A\u00a0testamentary trust<\/strong>\u00a0becomes effective upon your death and is usually established by your last will and testament. It enables you to control the distribution of your estate (and often is used to name a trustee for assets left to minor children), but it does not avoid probate. You can change or revoke a testamentary trust during your lifetime.<\/p>\n

A\u00a0living trust<\/strong>\u00a0takes effect during your lifetime. When you set up a living trust, you transfer the title of all the assets you wish to place in the trust from you as an individual to the trust. Technically, you no longer own the transferred assets. If you name yourself as trustee, you maintain full control of the assets and can sell or give them away as you see fit. However, this option may negate any estate tax benefits.<\/p>\n

Living trusts can be\u00a0revocable<\/strong>\u00a0or\u00a0irrevocable<\/strong>. A revocable trust can be dissolved or amended at any time while the grantor is still alive. An irrevocable trust, on the other hand, is generally difficult to modify or revoke.<\/p>\n

Special-Purpose Trusts<\/h2>\n

Trusts, whether testamentary or living, can be established for a variety of specific purposes. Here are three of the most common.<\/p>\n

Incentive trust<\/strong>\u00a0\u2014 Makes the transfer of assets to heirs contingent on their meeting goals or expectations, such as attaining higher education or starting a family.<\/p>\n

Supplemental or special-needs trust<\/strong>\u00a0\u2014 Can help provide for a disabled child and may ensure that the child qualifies for government assistance programs.<\/p>\n

Charitable trust<\/strong>\u00a0\u2014 Enables you to provide a charitable organization with a regular income for a set period or a lump sum at the end of the period.<\/p>\n

There are costs associated with creating and maintaining a trust, and the use of trusts involves a complex web of tax rules and regulations. Consider the counsel of an experienced estate planning professional and your legal and tax advisors before implementing a trust strategy.<\/p>\n

This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. \u00a9 2018 Broadridge Investor Communication Solutions, Inc.<\/p>\n

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[vc_row][vc_column][vc_single_image image=”843″ img_size=”full” alignment=”center”][vc_column_text] You may think trusts are only for wealthy people, but that’s not necessarily the case. A properly constructed trust can serve many purposes for families of […]<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false,"footnotes":""},"categories":[14],"tags":[],"_links":{"self":[{"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/posts\/979"}],"collection":[{"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/comments?post=979"}],"version-history":[{"count":0,"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/posts\/979\/revisions"}],"wp:attachment":[{"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/media?parent=979"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/categories?post=979"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/scrantonfg.com\/wp-json\/wp\/v2\/tags?post=979"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}