Most of us have driven down the freeway and seen the billboards displaying one lottery jackpot or another, momentarily getting lost in the thought of what we would do with a sudden windfall. The reality of winning the lottery, however, is not as simple as it might seem. Those who do beat the odds must contend with complex taxation issues that most of us will never brush up against, while others prefer to take a number of extra steps to ensure they are able to maintain as much privacy as possible about their winnings.
Providing for the ones you love is an important privilege for those who have the means to do so, but this is often more complicated than just writing a check and being done with it. If you have a loved one who depends on government assistance to afford living with a disability, then you might inadvertently disqualify that person from the crucial government assistance by carelessly leaving them too much money at one time. Fortunately, there are options. By employing a special needs trust, you can provide for the one you love without disqualifying them from government assistance.
When crafting an estate plan that takes into account grandchildren, there is some extra care that must be taken to ensure that your loved ones are cared for without creating extra difficulty for them in the long run. Because grandchildren are often minors, and may still be minors when they become receiving beneficiaries of your estate, some extra steps must be taken to make sure that your wishes are fulfilled without incurring extra fines or violating laws governing ownership by minors.
For many who are venturing into the complex but worthwhile field of employing trusts in their estate plan, life insurance is an asset that presents some unique challenges. Without taking proper precautions, a life insurance policy can present just as many problems as intends to solve for the survivors of a policy holder.
Many people use various kinds of trusts to preserve their assets and ensure that their intentions are stated and followed regarding their estates. There are different concerns involving trusts — how to establish and use them, the pros and cons of each type — but it can be unclear how trusts are terminated.
Trusts come in many shapes and sizes, each with their own specific purposes, advantages and restrictions. The crux of making the most of any form of trust is understanding exactly what you need, and how each form of trust may be able to most help you achieve your goals. One form of trust with a very specific purpose is a special needs trust.
Creating a trust can take many forms, but in order for it to be honored by a court or government agency, it must be formed validly. California offers its residents several options for creating trusts that may be honored, depending on the nature of the trust being created and its intended use.
There are many tools available to Californians for estate planning, each with its own designated purpose. Those who are crafting an estate plan often choose to employ one or more types of trust, depending on the goals of the individual forming the trust. For Californians who desire to avoid having their property go through the probate process, the revocable living trust is a very popular option.
One of the primary objectives for many estate plans is ensuring that assets are passed on to their intended beneficiaries, and not diminished or wholly taken by creditors. Commonly, this end is achieved using an irrevocable trust. Simply put, trusts allow individuals to transfer assets out of their own ownership and place them in the care of another person, so that they cannot be pursued as personal property. With these estate planning tools, it is possible to make sure that your wishes and legacy are honored as you intend for them to be.
A charitable remainder trust is an excellent option for those wishing to make charitable donations while selling assets that have appreciated significantly beyond their base value, such as stocks or real estate. Utilizing a charitable remainder trust can allow the seller to skirt capital gains taxation on the appreciated value of the asset, while achieving their charitable giving goals at the same time.