New York Estate Planning & Elder Law Blog
Many estate planning strategies can be utilized to achieve your goals. One of the most common techniques that people utilize to achieve tax and asset management goals is placing assets into a trust, but there are many complexities about how trusts operate. Among the various options for funding a trust, you might have heard about having any remaining assets from your will placed into a trust.
The Role of Pour-Over Wills
Establishing a pour-over will requires a person to establish both a will and a trust. Language within the will should then state that all or some of a person’s assets pass into or “pour-over” into the trust once that person passes away. Assets that are placed in the trust are then used to fund distributions to beneficiaries. If all of your assets are passed to the trust, your estate will not be required to pass through probate court.
Utilizing Revocable Living Trusts
In many cases, the trust that you create in addition to a pour-over will is referred to as a revocable living trust. A person can alter the terms of the trust, which might include revising terms about contributing or removing property. Although a person remains control over this trust while they are alive, the trust automatically becomes an irrevocable trust after the person’s death. This means that during a person’s life, the individual can place any assets that they wish into the trust. Provided that your will gives all of your assets to the trust after you pass away, you will not be required to place any assets in the trust while you are alive.
What Are the Advantages of Placing Assets in a Trust with a Will?
One advantage of placing your assets into a trust using a pour over will is that you can avoid probate court. This assumes of course that the irrevocable trust is the only recipient of any assets that are named in the will. By avoiding probate, a person’s estate will be administered more quickly and more inexpensively. The saved money can later be passed on to beneficiaries, who can make the most of it.
Another substantial advantage of avoiding probate is that this often means any creditors or people to whom the deceased person owes money will have a more difficult time collecting on debts. This is because if an estate passes through probate, creditors will have the ability to make claims against the deceased person’s estate and receive assets. As a result, if a person has substantial debts, it might be beneficial to have assets immediately placed in a trust.
Contact an Experienced Estate Planning Lawyer
If you have questions about achieving your estate planning goals or need assistance with creating a trust, a knowledgeable attorney can help. With substantial experience dealing with a variety of estates, the attorneys at Ettinger Estate Planning can help. Contact our law office today to schedule a free case evaluation.