Trusts can be very useful, but they are not for everyone. Here, commonly asked questions are answered. If you are thinking about opening a trust, already have a trust and have questions, or are simply unsure of what to do about an estate plan, contact our lawyer for trusts in Buffalo NY to schedule a free initial consultation and get answers to your specific questions.
What is a Trust?
A trust is a fiduciary relationship wherein one person or entity, known as the trustee, has custody and control over certain assets. The custody and control of the assets are given to the trustee by the trustor. The trustee has the responsibility of managing the assets according to the terms of the trust and for the benefit of the person, persons, or entity the trust was created for. The person, persons, or entity benefiting from the trust is known as the beneficiary.
There are different types of trusts designed for various situations. Trusts are often used as an estate planning tool along with Wills.
When Do I Need a Trust in New York State?
Trusts can be used at any age and for a variety of reasons. Some of the most common reasons people will benefit from the use of a trust include:
If you have inherited a large number of assets, it is a good idea to look at a trust to manage them and keep them safe. It is also beneficial to place your own assets in a trust to protect your children's inheritance.
Special Needs Family Member
If you have a child or other member of your family who has special needs, a trust is a common way to protect any assets they may have access to. The trustee will ensure the proceeds of the trust are used for the special needs family member and not for some other purpose.
The terms of trusts, unlike Wills, are not made public. Trusts are a good choice if you do not want the details of your financial matters made public.
What are the Benefits of a Trust in Buffalo NY?
Benefits of a trust vary, but can include:
- Keeping certain assets judgment-proof
- Providing income to a special needs family member without having that income render them unable to receive public assistance
- Tax benefits
- Ability to avoid the probate process
There may be other benefits available to you depending on the circumstances of your situation.
What are the Disadvantages of a Trust?
Some trusts are irrevocable, meaning that once created, the trustor is unable to change the terms of or revoke the trust in its entirety. This loss of control is a huge disadvantage to many. That said, the trust may still be terminated, but it can be a lengthy process involving all parties to the trust.
Fortunately, it is possible to create revocable trusts (trusts that can be changed), but these types of trusts vary in the purpose that may not reflect the reason you created an irrevocable trust.
Another disadvantage is the amount of paperwork involved in setting up a trust and the costs associated with creating and managing it.
How Do I Terminate a Trust in New York State?
The ability and process to terminate a trust will depend upon the terms of the trust itself. Some make the process easy and the trustor may retain the ability to terminate the trust up until the moment of their death. Others are formed in such a way that once they are formed, termination requires a complex process and, in the end, may not be eligible for termination.
Contact a Trust Lawyer Today
At the Law Office of Thomas Denny, our lawyer for trusts will help identify what trust works best in your unique circumstances. There are many types of trusts that can be created, and most can be created as irrevocable or revocable. There are benefits and disadvantages to both. Contact us online or call 716-800-1234 to schedule a free initial consultation to learn what will work best for you and your specific needs.