In California, estate planning practices involve the use of irrevocable trusts for removing assets from the estate. These trusts help estate owners lower common risks related to liens and seizures issued by creditors. Estate planning makes it easier for heirs who are inheriting certain assets. Trusts lawyers in Redlands, CA can explain the options for irrevocable trusts.
What Is an Irrevocable Trust and How Does It Work?
An irrevocable trust allows estate owners to transfer assets out of their estate and into the trust. Once an asset is transferred, it is no longer the property of the estate owner, but they maintain full control over the assets. The estate owner can transfer assets out of the trust at any time without penalties.
A successor is identified by the estate owner in the documentation. Once the estate owner dies, the successor takes over the trust and uses the assets however they choose. Typically, the successor is their spouse or child.
What Are the Major Benefits of the Trust?
The estate owner doesn’t have to worry about losing any assets that are transferred into the trust. None of the assets are reviewed through the probate process. Creditors won’t receive any of the assets regardless of whether or not they place a lien against the estate. The only assets that go to probate are assets that are connected directly to the estate. Family members won’t lose assets through probate if the assets are protected in a trust.
Managing Tax Implications
Using an irrevocable trust eliminates inheritance taxes and makes the process more affordable for heirs. The successor must pay property taxes and income taxes for assets transferred into the trust. Tax implications aren’t imposed when the individual acquires the trust.
In California, estate planning practices offer several helpful ways for estate owners to protect their assets more effectively. Irrevocable trusts offer protection against the probate process by removing assets from the estate and taking the assets out of the estate owner’s name. All assets transferred into the estate are owned by the estate. Individuals who want to learn more about the estate planning process or irrevocable trusts can contact trusts lawyers in Redlands, CA through Betty Auton-Beck Professional Law Corporation right now.
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