It might be easier to start with the basic concept of trust law, and then move to the types and their specific benefits. Knowing how it works will be helpful when it comes to finding a professional living trust Fairfield CA attorney who can create rock-solid structures for trusts. This process safeguards a family's wealth and facilitates its transfer to the next generation while reducing the tax burden and other costs in many ways.
Trusts are basically registered entities wherein the trustee holds property that belongs to another party (the settlor). It's usually created as a better alternative to wills, and primarily intended to transfer benefits to a named person or set of people (beneficiaries). This structure separates the ownership and control of the property from the benefits it generates.
There are many kinds of trusts for different purposes, but the most important categorization is whether it becomes active during the settlor's lifetime or after their death. The latter are called testamentary trusts whose main purpose is to assist in the execution of last wills and testaments. This makes it one of the entities controlling part or all of the deceased's estate.
Trusts that become active while the owner is still alive are called inter-vivos or living trusts. They can created as either revocable or irrevocable trusts. The structure, beneficiaries and other aspects of revocable trusts can be modified after creation.
Trusts that are created to be irrevocable don't allow the owner to retain this kind of control. The main reason inter-vivos trusts are so popular is because they help families avoid probate. While the rest of the estate faces the delays and costs associated with the probate process, the property held in the trust skates free because it does not fulfill the definition of being under the deceased's ownership.
These trusts are therefore the perfect way to pass on an inheritance without having a huge chunk of it go to the government. Another big advantage is that it allows people to retain control over property while letting others handle its usage. Put simply, trustees manage the wealth and implement growth strategies, minimize the tax bill, distribute benefits to beneficiaries, etc.
The original owner of the property does not have to be involved in all this. However, the structure of these trusts ensures that the actions taken are exactly as intended by the settlor. If it is revocable, the owner may also step in to remove or add beneficiaries and further modify the structure.
There's a common misperception that only high-wealth individuals need or are able to afford a living trust. But as any good Fairfield CA attorney will be able to explain in a free consultation, it's an affordable and highly useful tool even for ordinary people who simply want to pass on their home and life savings, insurance benefits and other such assets to their children. Not to mention the fact that wills can be challenged in court and are often overturned, but trusts are virtually impregnable.
Trusts are basically registered entities wherein the trustee holds property that belongs to another party (the settlor). It's usually created as a better alternative to wills, and primarily intended to transfer benefits to a named person or set of people (beneficiaries). This structure separates the ownership and control of the property from the benefits it generates.
There are many kinds of trusts for different purposes, but the most important categorization is whether it becomes active during the settlor's lifetime or after their death. The latter are called testamentary trusts whose main purpose is to assist in the execution of last wills and testaments. This makes it one of the entities controlling part or all of the deceased's estate.
Trusts that become active while the owner is still alive are called inter-vivos or living trusts. They can created as either revocable or irrevocable trusts. The structure, beneficiaries and other aspects of revocable trusts can be modified after creation.
Trusts that are created to be irrevocable don't allow the owner to retain this kind of control. The main reason inter-vivos trusts are so popular is because they help families avoid probate. While the rest of the estate faces the delays and costs associated with the probate process, the property held in the trust skates free because it does not fulfill the definition of being under the deceased's ownership.
These trusts are therefore the perfect way to pass on an inheritance without having a huge chunk of it go to the government. Another big advantage is that it allows people to retain control over property while letting others handle its usage. Put simply, trustees manage the wealth and implement growth strategies, minimize the tax bill, distribute benefits to beneficiaries, etc.
The original owner of the property does not have to be involved in all this. However, the structure of these trusts ensures that the actions taken are exactly as intended by the settlor. If it is revocable, the owner may also step in to remove or add beneficiaries and further modify the structure.
There's a common misperception that only high-wealth individuals need or are able to afford a living trust. But as any good Fairfield CA attorney will be able to explain in a free consultation, it's an affordable and highly useful tool even for ordinary people who simply want to pass on their home and life savings, insurance benefits and other such assets to their children. Not to mention the fact that wills can be challenged in court and are often overturned, but trusts are virtually impregnable.
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