Timing the Transfer of Assets Into a Trust

When you pass, assets that remain in your estate may need to go through probate before they can be transferred. Depending on the size of your estate, it may need to pay taxes to state or federal government authorities. However, you can save future generations time and money by putting assets into a trust. How do you decide when it’s the right time to make such a transfer?

Which Assets Have the Highest Cost Basis?

If an asset has appreciated or is expected to appreciate in the near future, put it into a trust as soon as possible. For instance, if you have a stock that you think is going to suddenly grow in value, let it appreciate in the trust. The same is true if you own a business that you assume will continue to grow over several years or generations. Even after the asset is titled in the trust’s name, you can still retain control over it or derive an income from it.

Can an Asset Be Gifted Outright?

Let’s say that you have a bank or brokerage account that you want to pass to your son or daughter when you pass. If that son or daughter is under 21, a custodian will need to be appointed to handle the money on your child’s behalf. Even if your child is an adult, he or she might not be suited to inherit a large gift on his or her own. Instead of selling an asset and giving that child the proceeds directly, you can put the asset in the trust.

Don’t Hesitate to Seek Legal Advice

A trust administration lawyer in Las Vegas can help you draft a trust document or determine when to move an asset into a trust. This can help you retain control of that asset until you no longer want or need it to meet your financial needs.