There are a number of documents involved in a comprehensive estate plan. One of the most important documents you may want to create is a trust. Read on to learn more about the different types of trusts available in California.
What is a Trust?
A trust is a contract between a third party and an estate. The person who creates the trust is referred to as the trustor. The person who receives the assets of the trust is the beneficiary. There is also a third party involved. This third party, known as a trustee, manages the trust on behalf of the beneficiary. Essentially, the trustee manages the trust until the beneficiary receives the assets.
Types of Trusts in California
Everyone’s situation is different. As a result, there are a number of different types of trusts. An estate planning attorney can help you determine which trusts to create. The trusts available in California include:
- Revocable Trust: This is a popular choice, as it can be modified, changed, or terminated at any moment without the permission of the beneficiary.
- Irrevocable Trust: This requires a trustor to nullify their rights when it is created, meaning they have no more rights to the trust and cannot change or terminate it at all.
- Irrevocable Life Insurance Trust: This allows a trustor to remove their life insurance from their estate so that a beneficiary is free from any taxes placed on the policy.
- Testamentary Trust: This is created as part of a will and only becomes effective after the trustor passes away.
- Charitable Trust: There are two types of charitable trusts. A charitable leads trust allows the individual’s choice of charity to receive interest from their financial gift for a period of time. When it ends, the remaining may go to family or other beneficiaries. A charitable remainder trust allows charities to receive the trust’s assets at the end of its term. Until the end, the donor will receive interest on the gift.
- Special Needs Trust: This can be created for a loved one with a disability to ensure they receive the financial support they need throughout their life.
If you are interested in creating a trust, reach out to our firm today. We will walk you through the process every step of the way.
Contact our Firm
Working with an experienced estate planning attorney, such as Jaci Feldman of the Woodland Hills, California, Law Offices of Yacoba Ann Feldman, will ensure that you are taken care of when you need it most. Do not delay. Estate planning is a more urgent matter than you may think. You never know what the future holds. Contact The Law Offices of Yacoba Ann Feldman to schedule a consultation today.