Establishing Trusts in Florida
What is a Trust?
A trust is a legal arrangement in which a specific amount of assets or property is maintained by a person or entity for the benefit of one or more persons when they are unable to manage their own assets due to a decline in mental fitness or health. It is also commonly used for minimizing estate taxes and avoiding probate.
The common misconception about trusts is that they’re exclusively for the wealthy. Fortunately, trusts are utilized for a wide array of situations and it’s an excellent way to protect your assets from taxes and creditors. A meticulously constructed trust can provide financial advantages in affording extra needs outside of what Medicaid covers.
Types of Trusts
The two most common types of trusts are revocable and irrevocable trusts.
A revocable trust enables a grantor to retain the right during their lifetime and can be altered, changed, modified or revoked at their own discretion. Also known as a living trust, it is essential in avoiding probate. If ownership of assets is transferred to a revocable trust during the grantor’s lifetime so that it is owned by the trust when the grantor passes away, the assets will not be susceptible to probate.
An irrevocable trust cannot be altered, changed, modified or revoked once it’s created. When a property is moved to an irrevocable trust, nobody (including the grantor), can remove the property out of the trust. The grantor can decide who will manage the trust, who possesses access to trust assets during their lifetime, and how the property will be assigned once the grantor passes away. Irrevocable trusts are a vital component for Medicaid planning.
Other kinds of trusts include:
- Asset protection trust
- Charitable trust
- A/B trusts
- Spendthrift trust
- Special needs trust
- Trusts for minors
Let Our South Florida Legal Team Help You Protect Your Assets and Property
At Pazos Law Group, we are comprehensively knowledgeable in helping our clients establish the type of trust they need to take care of their assets and property, as well as themselves. Our experienced South Florida trust and estate attorney will thoroughly navigate you through the legal obstacles and provide careful guidance you can trust.
Contact us today for more information.