A grantor trust is an estate planning tool that can make it easier to manage your assets and leave something behind for loved ones. It’s not the best fit for every estate, but it’s a versatile option that many people find that they can benefit from when they are making a broader estate plan. A Washtenaw County trusts attorney can help you figure out if you should establish a grantor trust of your own.
Why Create a Grantor Trust?
A grantor trust can make it easy to account for all of your assets and make sure that the proper beneficiaries will receive them when you pass away. A trust can include all sorts of assets, not just money and property. You can put personal property in a trust. You can even fund your trust with items that mostly just have sentimental value.
Then these assets can be passed down to your loved ones when you die. Assets in a trust even avoid the probate process, court proceedings that would normally cost your estate money to settle.
Can I Stay in Charge of My Own Grantor Trust?
You can. You can add assets to the trust or take them out. It’s also possible to change the terms and the beneficiaries of specific assets. It is still a good idea to pick a trustee though. This person would manage the trust for you if you were to become incapacitated somehow. The trustee can be a close friend or family member you trust. A lawyer can also act as a trustee and there are companies that can serve as trustees.
As long as you are of sound mind and your trust is classified as a revocable trust, you can adjust its terms. Just know that some other types of trusts, like irrevocable trusts, can offer other benefits in exchange for the lack of control. This is why talking to an estate planning attorney about all of your options is such a good idea.
Will a Grantor Trust Reduce My Tax Bill?
Generally, no. A grantor trust can provide some protection from estate taxes, but an estate really has to be worth a lot of money for those to factor in. Most families do not have to worry about estate taxes. You still have to pay taxes on any income made from a grantor trust though.
Can I Dissove a Trust Later?
As long as your trust is revocable, you can also decide to dissolve it later. Take all assets out and undo your trust whenever you want to. If this arrangement wasn’t working for you, our attorneys can help you find estate planning tools that would work well for you.
Talk to an Estate Planning Attorney Today
Estate plans are not just for extremely wealthy people. If you do not already have a plan of your own, contact Collis, Griffor & Hendra to schedule a consultation with our lawyers. We can help you use tools like grantor trusts to safeguard your assets for the next generation.
