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Law Offices of Amy R. Turos.

A trust is an estate planning document. There are different types of trusts, so when a client asks me about a trust, they usually do a Google search on it, and they have a basic idea of what a trust is. But basically, it’s a contract with yourself on how you wish to allocate you’re assets when you pass away. It depends upon the kind of trust you have but nine times out of ten, the person who makes the trust is also the trustee. So how I explain it to clients is it’s a contract with yourself, and it allocates how your assets will be distributed when you pass away. Nine times out of ten, you’ll be the trustee of your own trust. When you pass, you name a backup trustee, and that person will take over and handle your assets and distribute your assets according to your trust.

What Are The Different Types Of Trusts That You Most Commonly Use With Your Clients?

The most common type of trust I see is an irrevocable and revocable trust. I prefer revocable trusts because they offer the most flexibility. If you’re the trustee of your revocable trust, you can transfer assets in and out of the trust as you wish. Irrevocable, many clients ask me about that. Irrevocable trusts are for specific purposes. I get many calls from clients that are afraid of Medicaid liens. That’s the most common when I see it. So with the irrevocable, it can’t be revoked, and the person who makes the trust cannot be the trustee. You have to give up all control, so you would have to name a trustee to manage your assets. So, they’re not the most common type, but I get many calls on the irrevocable trusts.

The revocable trust, I do see a lot because it offers more flexibility. There is a special needs trust that I get many calls about and people will need this type of trust where a minor or an adult with special needs will inherit or is about to inherit money and that money will disqualify them for government benefits.

What Generally Would Be The Purpose Of An Irrevocable Trust?

With an irrevocable, it can’t be revoked. So when you give control of your assets, it’s harder for somebody to put a lien against your assets or for Medicaid to put a lien on something. It helps protect your assets when there’s a potential Medicaid lien. A client said, “I don’t want the government taking my stuff,” which is the most common phrase I hear, so I always ask clients, “What are you concerned about? Why do you think you need a trust?” We have to dissect the client’s goals and requirements to determine whether an irrevocable or revocable trust is right for them.

Can I Change The Terms Of My Revocable Trust At Any Time?

With the revocable trust, I explained it as it’s your contract with yourself on how you’re assets will be allocated when you passed away which means you create the terms and conditions of your trust. That’s not a problem. With the irrevocable, that’s where you can’t just automatically change the terms of the trust. Your trustee would have to do that. You give up control of that, which is the significant difference between those two. With a revocable, if you want to put in your trust, I can amend it. That’s no problem. With the irrevocable, that’s a lot harder to do.

Is A Will Just As Good As A Trust? Do I Need Both?

It just depends upon what the client’s goals and concerns are. I just had a client in my office the other day, she just asked me the same questions, and I want to know what the client wants to protect. Once we narrow down their concerns or what their goals are or what asset they wish to protect, we work backward. There are different estate planning tools for assets, there are millions of kinds of assets, and there are different types of estate planning tools. So that’s why I have to get down to the details of the client’s concerns. I need to get down in there and see what asset they’re concerned about. But our main goal in estate planning is to try to preserve assets as much as possible.

Is a will just as good as a trust? It depends on the asset and how much the asset is. It’s hard to answer because we have to sit down with the client and see their goals. With a trust, it’s more complicated than a will. A basic will can be two pages, and it can be a catchall. Many clients like that it’s something straightforward and easy.

With the trust, I mean it can be several pages long, there’s way more paperwork involved, so there is a lot more planning involved. With the trust, you have much more control over your asset distribution versus a will. A will is just a basic document that says, “Everything goes to my wife or my loved one or my kids,” but the trust, it’s so much more detailed. It’s usually popular with people with many assets to divide it up amongst the children or a spouse or something like that.

For more information on Estate Planning Law In Ohio, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (330) 738-8383 today.

Amy Turos, Esq.

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(330) 738-8383