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There are many things that can help you decide whether to create a trust as part of your estate plan.  Talking to an Alabama trust attorney is the best way to find out if one or more trusts can provide you advantages that are worth pursuing.

Trusts are an estate planning tool that can be created for a variety of benefits.  They can shield your assets from taxes, provide for minor or disabled children, give you flexibility in naming beneficiaries and heirs, and create a method for giving to charities.  One of the greatest benefits of trusts is the ability to avoid probate.  Depending on which kind of trust you choose, you can still retain a great deal of control over your assets throughout your lifetime, even if they’re placed inside the trust.

An Alabama trust attorney may be able to save you thousands of dollars in various state and federal taxes by creating the appropriate trusts.  A trust can also position you to benefit from Medicaid should you become confined to a nursing home without first depleting all of your assets. 

There is so much to know about federal and state laws regarding inheritance patterns and end-of-life issues.  Rather than feeling overwhelmed, a skilled and experienced estate planning attorney can walk you through the process of creating a trust step by step, as well as a will, power of attorney, guardianship designations or any other planning document you may need.  At Caldwell Wenzel & Asthana, we are happy to assist our clients in this way.  To understand more about the ways we can help you and your family, call us for a free initial consultation at (251) 444-7000.

How do I choose the best trust attorney?

An Alabama trust lawyer who goes above and beyond

There are many Alabama lawyers to choose from, but a trust attorney – especially a trust litigation attorney – is highly specialized and harder to find.  The skilled and experienced trust and estate planning lawyers at Caldwell Wenzel & Asthana stand head and shoulders above the competition.  Our trust attorneys are experienced litigators and are not afraid to argue your case in front of a judge.  We excel in the courtroom.  When it comes to estate planning, we are keen listeners and adept at using the law to create a unique plan that meets your family’s individual needs.  To find out more about our legal team, read our attorney bios here.

Different kinds of trusts

A trust is a financial tool that you (the grantor) create allowing a third party (the trustee) to manage and spend assets to benefit a person, group of people, or charitable cause (the beneficiary or beneficiaries). Trusts can be set up in several different ways and can state specifically when and how you want the assets (or income from the assets) to pass to the heirs and/or beneficiaries.  A trusts attorney can help you create a trust that meets your specific goals.

While there are several different kinds of trusts, they typically fall into two categories – revocable and irrevocable.

Revocable Trust

Also called a “living trust,” this kind of trust is created during the lifetime of the grantor and can be changed, modified or revoked at any time. The grantor usually serves as the original trustee of the grant.  This is a very useful tool to avoid probate.  A grantor can use a revocable trust to transfer the title of real property or assets to the trust.

This kind of trust can be dissolved at any time if a trustmaker’s circumstances or desires change. These trusts often become “irrevocable” when the grantor dies.  A grantor can make provisions for a successor trustee if he or she becomes incapacitated or dies. However, these trusts can be subject to estate taxes and will be treated as an asset during a person’s lifetime.

Irrevocable Trust

This type of trust can’t be changed by the grantor after it is created. While the absence of control is a drawback, the benefits may offset this.  By transferring the grantor’s assets out of his estate, it may place the assets out of the reach of estate taxes and probate. To reduce estate tax liability, this may be an option to consider. It could also shelter assets from legal judgments against a person, and it can be a part of Medicaid planning.

Other kinds of trusts include:

Charitable Trust

These trusts benefit a particular charity or the public at large.

Special Needs Trust

These trusts are created to provide in the future for children or other family members with special needs.  A special needs trust is typically set up for a disabled person who receives government benefits so that they are not disqualified from continuing to receive those benefits.

Tax By-Pass Trust

This trust allows one spouse to leave money to another spouse while minimizing the amount of federal estate tax.

Constructive Trust

Also called an “implied trust,” this trust is set up by a court, which decides that even though no formal trust was declared, facts show that the asset owner intended that property be used for a certain purpose or be given to a certain person.

The fiduciary role of a trustee

The grantor names a third party to act as trustee and administer the trust after the grantor’s death.  With revocable trusts, the grantor himself often serves as the original trustee.  The role of a trustee is an administrative one – referred to as a “fiduciary duty” — and they must carry out their role by following the instructions laid out in the trust document.

The fiduciary role of a trustee includes:

  • Maintaining records to establish that trust assets are appropriately managed and spent
  • Releasing this information to beneficiaries when requested
  • Fully following instructions and goals as delineated in the trust document
  • Paying federal and state taxes as required
  • Not treating trust assets or income improperly (such as misappropriation or fraud)
  • Avoiding conflicts of interest
  • Maintaining integrity and cognitive sharpness to fulfill the role of trustee.

When things go wrong, you need a trust litigation attorney

If arguments erupt between beneficiaries or you believe a trustee is not fulfilling their fiduciary duty, then it’s time to talk to an estate litigation attorney.  While we often hope that estate matters can be ironed out through discussions, sometimes they can’t.  Litigating in court is a tough and aggressive job, and not all estate planning lawyers are prepared to do it.  At Caldwell Wenzel & Asthana, we are.

Our legal team has years of experience in the courtroom, and we’re prepared to litigate on your behalf to achieve a favorable outcome.  A trust dispute lawyer is an ally and asset when things go wrong.  We have had enormous success in both probate and circuit courts and through mediation in matters concerning estate and trust litigation.  These issues can include:

  • Breach of fiduciary duties by executors, trustees, administrators, guardians, powers of attorney  and conservators, as well as defending against accusations of breach of fiduciary duties
  • Accounting proceedings to challenge or defend management of an estate or trust
  • Undue influence, will contests, and mental incompetence
  • Interpretation and construction of documents and validity of documents
  • Spousal rights proceedings to question or establish inheritance rights
  • Contests regarding appointment of guardians and conservators
  • Removal of trustees, executors, administrators, powers of attorney, guardians, and conservators, as well as defending against accusations concerning such removal.

If a trustee or beneficiary is exerting undue influence on an elderly family member, hiding or misappropriating funds, misrepresenting the instructions of the grantor, or engaging in other inappropriate behaviors, a trust litigation attorney can aggressively represent your best interests in court.

Why is estate planning important?

Estate planning is one way to avoid future conflicts while giving your family peace of mind.  One of the greatest gifts you can give your loved ones is pre-planning end-of-life matters.  That way you have time to discuss your plans and goals with heirs so there is no confusion or hurt feelings later.

Some of the benefits of estate planning include:

  • Making sure your wishes are known and carried out after you’ve passed away
  • Avoiding confusion and conflict among your heirs
  • Giving you flexibility and freedom during your retirement years
  • Avoiding onerous estate taxes and probate
  • Creating methods for charitable giving
  • Putting in writing your funeral and burial wishes
  • Providing for your surviving spouse
  • Collecting all important documents in one place (life insurance policies, real estate deeds, bank and brokerage account numbers, etc.)

How do I know if I need a trust?

A common misconception is that only very rich people need trusts, but this is not the case.  Many families can benefit from creating a trust as part of their estate plan, either to ensure inheritances, minimize taxes, designate guardianships, or provide for handicapped children.  The best way to determine whether you would benefit from a trust is to speak to an estate planning lawyer.

Beyond trusts, some of the other documents that are part of an estate plan include:

  • Last will and testament
  • Power of attorney
  • Living will/advance directive
  • Letter of intent
  • Beneficiary designations
  • Guardianship designations.

It’s a great idea to create a binder in which you collect your bank and brokerage statements, mortgage documents, personal loan and credit card information, life insurance policies, birth certificates, marriage certificates, divorce decrees, automobile titles, property deeds, account and device passwords, as well as extra keys to your house and cars.  By gathering these important items all in one place, you will not only have easy access and peace of mind, but you’ll also have all the documents you’ll need to start the estate planning process with your lawyer.

Also, have a conversation with your grown children, and stepchildren if applicable, and let them know that you and your spouse are starting the estate planning process.  It’s always good to have open communication when creating an estate plan or discussing your decisions about the future.  That way, there are no surprises, and your heirs will know what your inheritance plans are.

Contact a skilled Alabama trust attorney today

If you are curious about the benefits of creating a trust, or if you are in opposition to decisions being made about a trust for which you are a beneficiary or a trustee, then a phone call to a skilled Alabama trust attorney makes sense.  Gathering legal information and understanding your options is a critical first step.  The experienced trust lawyers at Caldwell Wenzel & Asthana have helped countless families create estate plans and trusts that provide peace of mind now and security for the future.  We can do the same for you.  Our client victories make our work worthwhile.  To find out more about how we can serve you, call us for a free initial consultation at (251) 444-7000.

GETTING HELP

Our estate planning and litigation attorneys are some of the most active litigation practitioners in Alabama. Our lawyers have had enormous success in both probate and circuit courts. To schedule a free consultation with our experienced Alabama estate planning attorneys, please contact us.

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