Trusts are integral to estate planning and can serve you throughout your lifetime. As a skilled estate planning attorney could explain in more detail, they are used to manage assets and can be amended as you see fit if they are revocable, and they provide favorable tax circumstances if they are irrevocable. You can serve as trustee in some cases, or you can appoint a trusted friend or loved one or a professional firm to distribute assets after your death.
Trusts circumvent probate, making asset distribution immediate. They allow you to qualify for nursing home care under Medicaid and provide for a disabled family member without disrupting their Social Security benefits. You can even provide for beloved pets. Get together with a Melville trusts lawyer to learn how trusts could benefit you today.
Living trusts, also called revocable trusts, avoid probate and are controlled by their makers (grantors), who can add or delete beneficiaries and assets at any time while they are alive. The trust becomes irrevocable once the grantor dies. They are less expensive than probate and private, unlike wills that anyone can search for in public records. If the grantor becomes incapacitated, a named trustee can step in to manage assets instead of the court stepping in and appointing a conservator. A Melville lawyer could help with this process as part of a trust.
Grantors deposit assets into irrevocable trusts governed by an independent trustee, which becomes the new owner of the assets, divesting the grantor of income and creating a tax advantage. Grantors cannot make changes because they technically no longer own the assets. A Melville trust attorney works with clients to identify the most advantageous trusts for estate planning.
A Medicaid asset protection trust accepts assets so the grantor can qualify for long-term care under Medicaid, which caps income and assets to qualify. Although control over assets falls to a trustee other than the grantor, grantors can change beneficiaries as often as they wish if they are not themselves beneficiaries.
The current income threshold to qualify for Institutional/Nursing Home Medicaid, reported by the American Council of Aging, is $1,732 a month for individuals and $2,352 for a married couple. Income exceeding the Medicaid limit surfaces in a pooled or community spend-down trust. A non-profit organization manages the trust income. Talk to a Melville trusts attorney about the advantages of this long-term healthcare tool.
Parents, grandparents, and concerned loved ones can set up a special needs trust to support a cognitively or physically disabled loved one who is probably collecting Social Security disability and possibly supplemental payments from the federal government. These benefits also come with income caps, and leaving assets to a disabled loved one in a will can cause them to lose their benefits. A Melville attorney could help you create a special needs trust, which is a legal way to make their lives more comfortable without endangering their benefits.
Charitable trusts are set up to donate assets to a grantor’s favorite charities during their lives and after their death by naming them beneficiaries. Pets are family members, and the pound is filled with animals whose pet parents died, leaving them adrift. Wills do not accommodate pets, but pet trusts are valid under New York Estates, Powers, and Trusts Law § 7-8.1.
You may believe that estate planning is something left to old age, but it can benefit you and your family throughout your life. Trusts are an especially versatile tool. They provide for special needs loved ones, allow you to qualify for Medicaid, which pays for nursing home care without stripping you of all your assets, and offer tax benefits.
Trusts circumvent probate, making them cost-efficient and a quick way to distribute assets at the grantor’s death. New York even allows you to care for your beloved family pet, unlike a will. During our consultation conversations, we walk you through how a Melville trusts lawyer could define and meet your needs and goals when it comes to allocating your wealth. Contact us today to schedule a meeting at your convenience.
