Are Only The Rich “Trusty?”
The author F. Scott Fitzgerald once said to Ernest Hemingway, “The rich are different from you and me.” Hemingway retorted, “Yes! They have more money!”
Unfortunately, that is often the only difference clients see between themselves and people who plan with irrevocable trusts to protect assets from death taxes.
But there are many planning advantages to suggesting irrevocable trust planning for folks who don’t have to worry about Federal estate taxes.
Consider:
- Avoiding state death taxes – Many states have their own death or inheritance taxes that levy on much smaller amounts of taxpayer net worth.
- Protection from creditors – Assets in the trust are free from judgement or levies against the creator of the trust.Trust beneficiaries are also protected so long as assets remain in the trust.
- Detailed and private distribution planning – Sophisticated and multi-generational gifting and inheritance scenarios can be carried out free from the public scrutiny of the Probate Court.
- Ongoing control of property – Transfers of non-voting interests in property held by a Family LLC allows the creator of a trust to continue to determine use of the trust property.
- Spousal access – A married creator can grant broad access to trust property to a husband or wife allowing for withdrawals if assets and funds are needed later on.
- Lower income taxation – Trusts can be designed so that income on assets are taxed in the creator’s lower tax brackets, rather than the compressed high trust rates.
Hemingway also said, “The best way to find out if you can trust somebody is to trust them.” And he would probably say that the best way you can find out if a trust can help is to trust us to help you and your client with their next case, especially in coordinating a trust with their insurance planning. Contact Tom Virkler, JD – Director of Advanced Markets, at 706-614-3796 or tom@cpsadvancedmarkets.com.