One of President Trump’s most prominent items on his ‘to do’ list as the Nation’s 45th President was to repeal the estate tax (also called the death tax) to stimulate economic growth and “Make America Great Again!” Whether or not President Trump manages to repeal the estate tax, however, Trusts remain the best estate planning tools for the following reasons:
- Protect Minor Beneficiaries
- If a beneficiary under the age of 18 is named in a will, or is a default beneficiary under state intestacy laws (which is the estate plan the State of Nevada provides for anyone who has not made their own), that minor will be entitled to their entire share on their 18th birthday. I don’t know about the 18 year olds you know, but if I had received a big check at 18 I’d probably have nothing to show for it 10 years later except maybe a closet full of way too many clothes and cautionary tales for my children. To protect your minor beneficiaries, whether it be children or grandchildren, put their inheritance in a trust. In a trust, provisions specific to your situation and family may be drafted to perhaps delay an outright distribution until age 25 or 30. Provisions could also be added that would enable a trustee to pay for school, medical costs, a first car, or even a down payment on a house to assist that beneficiary with accomplishing worthwhile goals, rather than setting them up for failure with a blank check at 18.
- Protect All Beneficiaries
- Trusts can not only protect a beneficiary when he or she is a minor, but also from creditors and others, such as financial scammers, spouses during marriage, ex-spouses after marriage, caregivers, and anyone else who might try to get a piece of someone else’s inheritance.
More reasons why Trusts remain the best estate planning tools for estate planning will be forthcoming in my next Blog – stay tuned!
-Attorney Rebecca J. Haines