A grantor trust is a trust that you can set up and stay in control of. Not every trust allows the person who originally set it up to retain full control, so many people find this to be a useful estate planning tool. If you want to learn more about it and figure out if this kind of trust is a good fit for you and your assets, a Woodland Hills trust attorney from our firm can help.
Why Set Up a Grantor Trust?
A grantor trust can be a great way to set aside assets that you want to leave for your beneficiaries. These assets would not have to go through probate when you pass, so that saves your family time and money. The trust can also make it clear who gets what, so there is less chance of a conflict developing among your beneficiaries.
Is a Grantor Trust a Tax Shelter?
Not really. You still have to pay tax on any income the trust generates. The tax rate on trust income over a certain limit can also be quite high. Trusts can sometimes be used to reduce the burden of estate taxes. It’s a good idea to tell an estate planning lawyer exactly what you are trying to do with a trust and what kinds of protections you are looking for before you just set up some random trust.
Can I Change the Rules of a Grantor Trust?
As we mentioned before, you stay in control of a grantor trust as long as it’s revocable. A revocable trust can have its terms and rules changed by the person who established it, also known as the grantor, at any time. You can change what beneficiaries are going to receive when you die or you can add more assets to the trust.
If you do not want to manage your grantor trust yourself, you can assign a trustee to handle these matters. This trustee can be a close family member or friend, someone you trust. You could also choose a lawyer or a corporate trustee.
Can I Dissolve My Trust?
Because your grantor trust is revocable, you can also decide that you do not want to use it anymore. You can dissolve it and take a different approach to your estate plan whenever you desire. We don’t recommend constantly changing your mind about what to do with your estate though, which is why meeting with our lawyers and deciding on a comprehensive plan is a good idea.
Schedule a Consultation with Our Team
If you are ready to set up a trust or make an estate plan of your own, don’t try to do it alone. Contact the Law Offices of Yacoba Ann Feldman to learn more about what our attorneys can do to assist you and your family. Every estate is different, but we’re ready to help you make a customized plan that protects your assets and beneficiaries.
