trust

What Does It Mean To Break A Trust?

When you create a revocable trust, it’s usually because you want some level of control and flexibility over the operation of that trust. As a result, you may be able to dissolve the trust at some point in time. If you no longer need or want the trust, you can choose to revoke it or change the stipulations inside so long as it’s a revocable trust.trust

Breaking a trust refers to the process of dissolving a trust that has been established for estate planning purposes. This can also refer to one party distributing its assets and dissolving the trust, either to the trust beneficiaries or back to the original donor. This can only happen at the discretion of the creator of the trust. A trust fund is one way for managing assets held on behalf of someone else or yourself. When you create a trust and find those assets into the trust, you also set terms for how the trust assets will be distributed.

Breaking or dissolving a trust is only possible with a revocable trust, which by its very nature can be changed or revoked over any period of time. An irrevocable trust, however, must be established and maintained over the course of the creator’s lifetime. The main benefit of an irrevocable trust is that because the assets truly do not belong to the person who has created it, it may be protected from creditors more than a revocable trust.

There are many different kinds of trusts you can use for estate planning in New Hampshire. If you’re interested in using these or other estate planning strategies to accomplish your goals, set aside a time to meet with a qualified attorney.

 

 

owner death

What Happens to a Revocable Living Trust When the Owner Passes Away?

owner death

There are many different types of trusts that people choose to use for estate planning purposes. The most basic, however, are known as revocable living trusts. You can set up a trust like this by contacting a local estate planning lawyer and discussing which assets you hope to place into or distribute through the trust.

This involves the grantor or the creator setting up a trust that keeps that person in control while they’re still alive.

This can also include the appointment of a separate trustee to manage the assets inside, but many revocable living trusts allow control and flexibility, which is why the creator stays involved over the course of their life. In the event that any changes are needed for the trust, the creator can revoke or amend it. The trust then owns the assets, but any dividends, income and capital gains are taxed to the creator while they are still alive.

The tax ID number for many revocable living trusts, for example, is also the creator’s social security number. In most cases, when the grantor of the trust passes away, it becomes irrevocable. That means it may be subject to tax trust rates for income that accumulates inside the trust, however, some deductions may apply, which means that higher tax rates may not be added. The most common deduction is known as distributable net income.

Trusts can be a very powerful and yet complicated asset management tool, depending on how they are structured. Finding an estate planning attorney who can walk you through the pros and cons and discuss your next steps is helpful. Our New Hampshire and Maine trust lawyers can help you with your entire estate plan.

family estate planning

Should I Have a Trust Only When I Hit a Certain Level Of Net Worth?

family estate planning

Everyone needs estate planning, regardless of how much you own or your net worth. Sometimes, people skip valuable estate planning tools because of misconceptions about needing a certain level of wealth to benefit from them.

A trust is a popular estate planning tool that can be used by a wide range of people to achieve their goals. You do not need to reach a certain level of net worth or have a specific number of assets to benefit from using a trust. However, there are certain points of financial stability and wealth that trigger advanced considerations in estate planning.

Trusts offer numerous safeguards and benefits for your loved ones and assets. In these legal arrangements, you transfer assets inside the trust for a trustee to manage on behalf of the beneficiaries. The appointed trustee has a legal responsibility known as a fiduciary duty to act in the best interest of the beneficiaries. Trusts provide numerous benefits, such as minimizing estate taxes, avoiding probate, adding a layer of privacy, and ensuring that your assets are distributed to your heirs.

Determining whether or not you should establish a trust depends on multiple factors, including the complexity of your assets, your net worth, your desire for privacy, and your estate planning goals. Net worth is not the sole determining factor for choosing a trust, although it is an important one.

Working with an experienced estate planning attorney is one of the best ways to cover all your bases when it comes to establishing a trust and using other estate planning tools. Finding an attorney early on allows you to establish a relationship now so that you can continue to update your estate plan over time. Contact our NH estate planning office today for more information.

trustee

Important Questions to Ask When Choosing a Trustee in NH

trustee

Establishing a trust in New Hampshire requires that you appoint a trustee to manage it. Living trusts may be used for any estate that has a high value of assets and/or possible complications.

Living trusts allow people to exercise greater control over when and how their money gets dispersed to their heirs, both during the course of their life and after they pass away, which is significantly different than leaving the funds outright to a beneficiary in a will.

Most people serve as the primary trustee on their own living trust but will need to appoint a backup trustee or can appoint someone else outright. If you create an irrevocable trust, you will appoint another person to serve as the trustee. As the trust creator, also known as the grantor, you should think carefully about who you name as a trustee.

Here are some questions to keep in mind as you think about naming this person:
• Do they have the appropriate financial know how to make critical financial decisions related to assets in the trust?
• Would it further complicate things to appoint a co-trustee or is it necessary due to the structure of the trust itself?
• Does it make sense to hire an outside professional, such as someone who works with a trust or bank company or attorney?
• If a family member is appointed in this role, how much time and ability do they have to serve to function in this role?

As you can see, there are many unique considerations for naming a trustee of a living or other trust. Finding the right person to serve in this role is extremely important as they will be responsible for administering the trust and communicating with beneficiaries. Take time to communicate with a lawyer in Dover, NH regarding your next steps.

Yes, Even Gen Z Needs Estate Planning

Retirement and long-term care needs feeling far off? Not so for Gen Z, who spend more time educating themselves about planning for the future and getting their ducks in a row with finances. And given that 25% of Americans will need long-term care at some point in their lives, it’s wise to spend the time creating an estate plan now.

Too many people are under the impression that estate planning is just about taxes and money, but it goes so much further. An increasing number of the Gen Z population are reaching out to do everything they can to protect their finances. Estate planning is also about the people you love, your hopes for them, their values and their character.

While many people put off the estate planning process until their 50s, 60s or even 70s, influencers in the social media world are inspiring Gen Z to learn more about finances much early. These individuals called finfluencers focus on living sustainably, investing in real estate, how to be frugal, becoming debt free and retiring early. One recent study found that nearly 20% of Gen Z-ers watch videos on YouTube or read blogs to learn more about financial matters. Since estate planning also incorporates the appointment of an agent to take care of your finances or health care decisions in the event that you’re unable to do so, Gen Z individuals can benefit from creating a basic estate plan.

Over time, the estate plan can be updated to incorporate more complexity in your life, such as buying a home or starting a family. Even a few documents such as a basic will and a power of attorney will give anyone peace of mind that they’ve taken proactive steps to protect their future. Let a NH estate lawyer help you with your plan.

inheritance

Are Your Loved Ones Prepared to Manage an Inheritance?

inheritance

 

If you think about your estate plan as a way for you to pass on gifts to your loved ones, have you considered whether or not they may be eligible or responsible enough to take on these significant assets? A recent study finds that the majority of Americans who may receive an inheritance in the coming years don’t have the ability to handle it.

New York Life’s Wealth Watch Survey found that only 42% of adults who are anticipating some kind of inheritance from a family member said they felt comfortable handling the new financial opportunities that will be passed down to them.

 

The study also identified that this breaks down even further by gender, with women being twice as uncertain about their ability to effectively manage an inheritance.

 

Using a trust is one way to provide more control and comfort for someone getting an inheritance. The funds or assets may be released when certain milestones are hit, such as graduating from college or reaching a certain age. Likewise, you can choose that assets are distributed over time to decrease the chances of making a big financial mistake.

 

Talking with your loved ones about these options or perhaps even placing the assets inside a trust can help to reduce some confusion and increase the chances that your loved ones will feel comfortable and understand the options available to them when it comes to an inheritance.

 

Open conversations and discussions about your legacy can help to bring up all of the options you may undertake. Because there are so many complex factors involved in the estate planning process and all of them must be associated with your personal needs and plans, talk to an attorney now.

transferring property

Why Is a Trust So Valuable for Transferring Property?

transferring property

You may have the best of intentions with passing on property to other people directly, but it can create unexpected consequences if you’re not careful, Instead, you may turn to a range of tools to help ensure your wishes are followed, and one common strategy is to use a trust either during your life or in plans after you pass away to provide more control and clarity.

The most substantial transfer of wealth in our nation’s history is upon us, and you have many opportunities to leave property to your heirs and a will. However, when you put things in your will, that inheritance then goes through a legal process known as probate. You can avoid the public and time-consuming process of probate by creating a trust instead. Any real property currently owned by you may be transferred into an irrevocable trust or a revocable living trust.

You can customize a trust to the needs of your family or individuals, but getting out of probate is only one primary benefit of using a trust rather than a will or in addition to a will. When it comes to trust based real estate, upon the death of the owner, beneficiaries may also be eligible to tap into a step up in basis that they would not achieve with another method known as the lifetime gift of real estate. A step up in basis accounts for the adjustment of the value of inherited assets to their current fair market value, which therefore reduces the capital gains tax burden that the recipient owns on the asset.

Depending on your circumstances, this could have substantial financial repercussions for the loved ones you named to receive the asset. Communicate with an estate planning attorney in New Hampshire or Maine to determine whether or not this is most appropriate for you.

divorce

You Must Understand How Divorce Impacts Your Estate

divorce

Getting a divorce may be one of the biggest life changes you undertake. It can feel overwhelming, confusing, and emotionally taxing. Those are big reasons why making estate plan updates post-divorce get overlooked, putting your intentions for asset transfer at risk if something happens to you.

Depending on where you live, your soon to be ex-spouse may be entitled to assets under your estate. This is because if your divorce is not yet finalized or if you are only separated from your spouse, state laws may enable this person to receive assets from your estate if something happens to you.

Although you may not wish for this person to receive benefits from your estate, failing to take proactive planning steps such as updating your plans could put your loved ones in a difficult position. If a divorce is not yet finalized, your spouse may still be eligible to collect. The same goes for making updates to beneficiary designations in your retirement accounts and your life insurance policies.

These are easily forgotten in the hectic chaos of trying to close out your divorce, but it is extremely important to think about how you protect your current loved ones, such as your adult children or any new spouses by removing your previous spouse from your estate plan if you wish to do so.

Keeping your estate plan up to date doesn’t have to be difficult, but does require checking in after any major life changes and at least once a year. It’s a place where the details really matter.

Communicate with a New Hampshire attorney who can help walk you through a checklist of the various aspects to reconsider and documents to update after going through a separation or divorce. This will also help you understand any applicable state laws.

Should We Use Joint Ownership of Property with Adult Children?

Exploring strategies to make your estate plan as optimal and strategic as possible is highly recommended. Finding an experienced and qualified estate planning lawyer is very valuable to help you decide the best ways to own property or even share property with children in NH.

Gifting a piece of property outright may not be the right choice for you, which could lead you down the path of deciding how best to approach ensuring that they receive this property and have access. You may be exploring whether or not making them a joint owner is the best solution for estate planning purposes.

You may be curious about the benefits and the potential downsides of joint ownership. This may be referred to as joint tenancy. This is an arrangement in which beneficiaries are able to access your account without having to go through court. This often takes place with business partners and couples who may need access to one another’s real estate, personal property, brokerage accounts and bank accounts.

The biggest benefits of using joint tenancy ownership include sharing responsibility, maintaining continuity in the event that the other person is unable or unwilling to manage the account and avoiding probate courts.

However, depending on who you name and a joint tenancy agreement, you need to be aware of potential pitfalls, such as the possibility for the assets to be frozen, the need for parties to agree on what to do with the asset and potential loss of control over the distribution of assets after death. Communicating with a qualified estate planning attorney is one of the only ways to verify what is truly in your best interest. Scheduling a consultation with an experienced and knowledgeable lawyer should be done immediately.

long term care

What Are Your Chances of Needing Long Term Care?

long term care

Research from the World Health Organization shows that people are living longer. However, this isn’t all good news, as many people may not recognize the potential for suffering serious medical conditions in their later years. By 2030, one in six people all over the world will be at least 60 years old.

This means that many countries are experiencing a significant surge in older populations, which raises many serious and complex health concerns. These can include things such as higher risk for dementia, overall frailty, urinary incontinence, neck and back pain, hearing loss, cataracts, pressure ulcers, COPD, depression, diabetes, and osteoarthritis. Some individuals will even experience more than one of these at the same time.

If you don’t think you’ll be impacted, you’re wrong: over 70% of people aged 65.6  and above will need some kind of long-term care support in their future. Some may require ongoing care or a permanent stay at a nursing home. If you have not considered the possibility and how you might pay for it, you need to think now about how you might qualify for Medicaid in NH by speaking with an elder lawyer.

Creating a long-term care plan is an important component of establishing your goals for your individual estate. This helps you to articulate the types of medical choices you want made regarding your care and even can appoint other people to help make these decisions on your behalf should you trust them and name them to do so. There are many complicated components to establishing a complete long term care plan, which makes it even more important to identify a lawyer in your region who has the appropriate experience, understanding and compassion to help you craft a plan that is aligned with your individual needs.