In our last blog entry, we discussed what a revocable living trust is and some of the benefits of a revocable living trust. You may still be wondering why a trust is necessary for your estate plan when you could just have a will, and our Troy, MI estate planning lawyer is here to help you understand why having a trust is incredibly important and the benefits that it can provide. Our attorneys have over 100 years of combined experience, and our firm has an A+ rating with the BBB. For more information on why trusts provide more benefits than wills, contact Gudeman & Associates, P.C. today.
The Benefits of Revocable Living Trusts
The main benefit of revocable living trusts that most estate planners will tell their clients when discussing estate planning with their clients is that assets that are part of a revocable living trust do not need to go to probate. By avoiding probate, a revocable living trust can save time, money, and effort for the trustee and beneficiaries when distributing the trust assets. Items left to be distributed in a will still have to go to probate. The terms of the will, along with Michigan law, guide the probate process and can help save time and effort when compared to an estate without a will, but probate will still be necessary.
Another benefit of avoiding probate is maintaining the privacy of the estate, the person who passed away, and the beneficiaries of the estate. When a will is submitted to the probate court, it becomes a public record. Anyone willing to pay the court for a copy can see exactly what the will states. Additionally, the probate forms and process itself will disclose other information to the public such as the names and addresses of the beneficiaries and the personal representative of the estate, the assets that are part in the estate and their value, who the decedent’s creditors were and how much they owed them, and who is receiving distributions from the estate and how much they are receiving. In a revocable living trust, because there is no requirement to go to probate, this information can, in most cases, remain out of public record.
A third benefit of a revocable living trust over a will is that a trust can provide for distributions to be made during the lifetime of the grantor. A will, by contrast, can only provide for distributions after the death of the grantor. This means if the grantor wanted to grant money from their trust to someone to help pay for education or medical care, in a trust they would be able to do so even if they were still alive. A will does not allow this kind of grant to be made in the document. This is especially important if the grantor becomes incapacitated, the incapacitated grantor is not going to be able to decide to give money or other assets to someone, but a provision in the trust granting the beneficiary this distribution survives the grantor’s incapacity.
While there are additional benefits, one last benefit of a trust we would like to discuss here are the potential tax benefits of using a trust. In a trust the grantor can structure the trust to take advantage of items like the federal estate tax marital deduction, which are often not available in a will.
Contact Our Troy Estate Planning Lawyer Today
As you can see, there are a multitude of reasons that a trust is considered to be superior to just having a will in estate planning. When it comes to your estate plan, legal guidance is crucial. Please call Gudeman & Associates, P.C. today so that we can discuss your particular estate planning needs with you and take care of yourself and your loved ones moving forward.
