Understanding the Three Classes of Trusts
There are more than 39 different types of trusts, and they can generally be divided into three different classes. Generally, considering your goals helps you know what type of trust you need to create. With so many different choices, however, you definitely need a trust administration lawyer in Las Vegas to help you make the final decision of which type of trust fits your needs the best.
Revocable trusts that are often called living trusts often helps your loved ones from having to go through probate. The probate process can be lengthy and costly. This type of trust can be especially important if you own property in more than one state because your estate may have to be probated in each state where you own property without it. Usually, these trusts can be changed until the time of your death or you are declared incompetent by a judge.
Assets in an irrevocable trust cannot be removed from that trust. Therefore, you essentially give away your property while you are still alive. One of the main reasons to create this type of trust is to avoid some taxes at the time of your death. An example of this type of trust is a life insurance trust. When you die, the money in a life insurance trust can be used to administer your estate and pay any taxes occurred.
A testamentary trust is usually created when a person writes a will. It has no money in it until you pass away. Then, a majority of your assets is placed in it. These trusts are usually the easiest to change as circumstances in a person’s life dictates. They are often used to help protect minor children if something happens to the parents.
Understanding the different classes of trusts is an important place to start, but you will need to talk to a lawyer to determine exactly which type is best for you.