Undoubtedly, a living trust can be an excellent option for individuals who want to protect the best interest of their loved ones upon death and avoid stressful probate proceedings. Yet, there are additional benefits associated with a living trust that may be used to enhance estate planning strategies.
In this article, you will discover the key advantages of setting up a living trust in Florida.
What Are the Benefits of a Living Trust in Florida? – An Overview
Protection for Disabled Beneficiaries
As provided by social security and Medicaid rules, a disabled person who is offered an inheritance may be disqualified to receive based disability benefits. If the person decides to disclaim or turn down the inheritance, the benefit may still be gone for a limited period.
In this sense, it is possible to circumvent these inconvenient provisions by properly drafting a revocable living trust. When preparing the trust agreement, the grantor can include a disabled beneficiary by adding language like “special needs” or “supplemental needs.”
This way, the disabled person can still receive the inheritance in a separate account while continuing to receive disability-based benefits.
Different cases require the use of specific language in the trust agreement (e.g., an adult child receiving SSI, a disabled person living as a dependent adult, aging parents, etc.). Hence, it is crucial to work with an expert attorney to ensure the use of adequate language for each case.
Estate Tax Management
Setting up a living trust may help individuals to manage federal estate taxes. When someone’s “gross estate” exceeds a certain threshold, the estate may be exposed to the federal estate tax.
Typically, it may incur around 45% of the amount owed. Additionally, the due date for payment is usually within 9 months of the estate owner’s passing. Unfortunately, families unaware of this inconvenient tax burden were put out of business.
It is possible to prepare a living trust to minimize estate taxes. An expert trust attorney has the knowledge and experience to adapt advanced estate planning strategies to each situation.
Protecting First Marriage Children
When it comes to estate planning, divorce is always complicated. In such cases, a living trust may provide a way for first marriage children to receive their fair share of their parent’s assets upon their passing.
Common solutions include transferring assets to a separate trust, controlled only by the biological parent, or limiting the right of a second spouse to change or revoke a joint trust upon the passing of the biological parent.
Unfortunately, inheritances involving second marriages are fertile soil for legal battles. When the grantor in trust has children from a first marriage, it is ideal to use the trust agreement to spell out what the surviving spouse can and cannot do.
Protecting Beneficiaries from Creditors
While trust asset protection does not extend to the grantor, it may be useful to protect beneficiaries upon the grantor’s passing. In Florida, a revocable living trust becomes irrevocable after the trust maker dies.
When a trust becomes irrevocable, all the assets held within the legal arrangement are protected against creditors, judgments, liens, and similar issues.
Do You Want to Enjoy the Benefits of a Living Trust in Florida? – Work with Attorney Romy B. Jurado Today
Although setting up a Florida living trust is not a hard task, knowing how to use a trust within a goal-oriented estate planning strategy requires expert knowledge. Waste no time – call Attorney Romy B. Jurado today at (305) 921-0976 or email [email protected] to schedule a consultation.