Azure Brio Associates

Trusts

At Azure Brio Associates, we understand the importance of protecting your assets and ensuring that your loved ones are taken care of, both during your lifetime and after your passing. Our team of experienced attorneys specializes in helping clients navigate the complexities of trust planning and creating customized legal documents that meet their unique needs and goals. Whether you’re looking to set up a revocable living trust, irrevocable trust, or special needs trust, we have the expertise to guide you through the process and ensure that your assets are protected for future generations. We are committed to providing our clients with the highest quality legal services and personalized attention they deserve. Let us help you plan for the future and provide peace of mind for you and your loved ones.

The Basics

A trust is a legal arrangement where a third party, called a trustee, holds ownership of assets and distributes the benefits to the beneficiary. The person who creates the trust is known as the grantor or settlor. This allows for a division of property rights and establishes a fiduciary relationship. Sometimes, the assets held in a trust are referred to as a “trust fund.” The trust is considered a right that can be enforced in equity, ensuring that the beneficiary receives the benefits they are entitled to.

To form a valid trust, the following elements are required:

  • A settlor who owns the assets
  • Settlor’s intent and capacity to grant their property rights and create the trust
  • A clearly defined beneficiary who can be identified now or in the future
  • A trustee who holds and manages assets in the beneficiary’s interests
  • Assets that are transferred to the trust
  • Compliance with legal formalities in the relevant jurisdiction, such as the trust being in writing, signed, and notarized.

The trustee of a trust has fiduciary obligations to act in the best interest of the beneficiary. In most cases, the trustee and beneficiary cannot be the same person, unless there are additional beneficiaries besides the trustee. If the trustee resigns, dies, or refuses to serve, the trust continues to exist. In such cases, the court will appoint a successor trustee.

It is not necessary to transfer the trust assets to the trustee immediately upon the creation of the trust. These assets may be transferred later, including after the death of the settlor.

Benefits of trusts

There are several advantages to creating a trust as part of your estate planning. Here are some of the most common benefits:

Avoiding Probate

If assets are bequeathed through a will, they often go through the probate process, which can be time-consuming and expensive. A trust can help your beneficiaries avoid probate, saving them time and money, and protecting your family’s privacy.

Increased Privacy

Trusts can offer greater privacy protection, as they do not typically become public record.

Tax Benefits

Some types of trusts can facilitate the transfer of assets out of the estate, leading to potential reductions in estate and gift taxes.

Asset Protection

By transferring ownership of assets to a trust, you can shield them from potential creditors and judgments against you.

Control Over Assets

A trust allows you to specify how your assets will be distributed and when they will be received by your beneficiaries after your passing.

Naming Children as Beneficiaries

A trust can be used to name your children as beneficiaries of your life insurance policy, providing added financial security for your loved ones.

Living Trust vs. Testamentary Trust

To better understand the different types of trusts, it is helpful to compare the two primary categories: living trusts and testamentary trusts. There are also revocable trusts and irrevocable trusts, but these are separate distinctions.

  • Living Trust: Also known as an inter vivos trust, a living trust is created during the trustor’s lifetime. The primary purpose of a living trust is to efficiently transfer assets to beneficiaries while avoiding probate, which can save time and expenses for the beneficiaries and potentially reduce estate taxes.
  • Testamentary Trust: This type of trust is established after the trustor’s death and is typically outlined in their will. Because the terms of a testamentary trust can be changed up until the trustor’s death, it is often simpler and more flexible than a living trust.

Revocable Trust vs Irrevocable Trust

To help secure your assets and plan for the future, it’s important to understand the differences between a revocable trust and an irrevocable trust.

  • Revocable Trust: A revocable trust, also known as a living trust, can be altered during the grantor’s lifetime. The main purpose of a revocable trust is to avoid probate for the transfer of assets after death.
  • Irrevocable Trust: On the other hand, an irrevocable trust cannot be changed once it’s created. The main reason for creating an irrevocable trust is to transfer assets out of the taxable estate, which allows for income from the assets to no longer be taxed during the trustmaker’s lifetime, and the assets to not be taxed to the estate upon their death.

Trust Azure Brio Associates for Your Legal Needs

Making the decision of which type of trust to choose, or whether a trust is the best option for your situation, is a serious matter. It is not just about your legacy, as trusts are legal instruments that must meet specific state requirements to be valid and enforceable. Any ambiguity or unclear language in the trust can lead to conflicts, delays, or even the possibility of the trust being declared invalid by a court.

Fortunately, the legal team at Azure Brio Associates has significant experience in preparing and drafting trusts of all kinds. They understand that each client has unique circumstances and goals that need to be considered when creating an estate plan. For this reason, they work closely with their clients to develop a personalized strategy that meets their interests. If you are unsure whether a trust is right for you or would like to learn more about their estate planning services, please contact us at + 1 (443) 686 8365, + 57 (315) 359-6683 or email us at info@abrioconsultancy.com to book your consultation with one of our experienced attorneys.

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