Trusts
What is a trust?
A trust is basically an agreement that is made during your lifetime between you (the grantor or trustor) and a trustee, which can be either an individual or an entity such as a bank. The trust agreement determines how the assets placed in the trust will be managed and distributed. There are a variety of reasons that people establish trusts, such as asset management, asset protection or estate tax planning.
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What are the different types of trusts?
A common trust is a Revocable Living Trust, which may be used as a "will substitute." It contains provisions regarding asset management and disposition of assets upon death. Another type of trust is a Testamentary Trust, which is a trust funded only upon an individual's death. Another technique is to establish an Irrevocable Life Insurance Trust, which may provide estate tax savings. There are different types of trusts for different purposes and not everyone needs a trust.
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What is a Special Needs Trust?
A Special Needs Trust is a trust that is designed to provide funds to the beneficiary in such a way that the beneficiary remains eligible for public assistance programs. Gifts can be made to the trust. It may also be established to hold an inheritance.
Source:
Elder Law Attorneys (NAELA)
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