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What Are the Pros and Cons of a Family Trust? PRO: AVOID PROBATE. PRO: SIMPLE AND FLEXIBLE. PRO: LIMIT ESTATE TAX EXPOSURE (AND OTHER TAX BENEFITS) PRO: AVOID LEGAL PROCEEDINGS. PRO: NO RISK TO PUBLIC BENEFITS ELIGIBILITY. CON: POTENTIAL LOSS OF CONTROL AND/OR LACK OF FLEXIBILITY. CON: COST.
What assets cannot be placed in a trust? Retirement assets. While you can transfer ownership of your retirement accounts into your trust, estate planning experts usually dont recommend it. Health savings accounts (HSAs) Assets held in other countries. Vehicles. Cash.
Most banks prefer that you and your spouse come to a local branch of the bank and complete their trust transfer form. Typically this is a one or two page document that will ask you to list the name of your trust, the date of the trust and who the current trustees are.
Some of your financial assets need to be owned by your trust and others need to name your trust as the beneficiary. With your day-to-day checking and savings accounts, I always recommend that you own those accounts in the name of your trust.
There are three main advantages of family trusts: Asset protection. Protecting vulnerable family members. Tax benefits.
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Upon your death, however, the trust agreement acts like a will and provides for the distribution of your assets to your beneficiaries, either outright or in further trust. As long as you transfer your assets into the trust before your death, the assets do not go through probate.
Another potential advantage is that a trust is a way of keeping control and asset protection for the beneficiary. A trust avoids handing over valuable property, cash or investment while the beneficiaries are relatively young or vulnerable.
The grantor can set up the trust, so the money distributes directly to the beneficiaries free and clear of limitations. The trustee can transfer real estate to the beneficiary by having a new deed written up or selling the property and giving them the money, writing them a check or giving them cash.
A trust instrument is not required to be docHubd in Maryland. However, it is common practice to docHub the settlors signature and the witnesses signatures of the trust agreement to express that the settlor: ∎ Intentionally created the trust.
A trust allows assets to be distributed immediately upon your death with no wait if you so wish. In Maryland, income tax is applied to assets in a trust, but not to assets that pass via a will, so it is important to calculate how this cost would impact your assets.

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