Good planning neutralizes threats

Good estate and asset protection planning with proper use of trusts can neutralize many threats, namely: Loss of assets to---taxes, lawsuits, probate fees & costs, family disputes, loss to in-laws if a child becomes divorced.

Do you have a married child who may become divorced later in life? Unfortunately, in modern times the risk of divorce is high. Some statistics indicate that nearly 50% of newly married couples will divorce later in life. Leaving assets to them in trust, instead of outright, can protect these assets from claims of alimony and division in a divorce. You can then direct the assets will stay in your bloodline and not go to your in-law.

Do you have a child or grandchild with “special needs?”
If there are government benefits a loved one receives, then leaving assets to them in trust, instead of outright, can help preserve these benefits for your loved one.

Do you have a child or loved one who has demonstrated an inability to manage assets? Perhaps, they are in serious debt or have a gambling problem. Leaving assets to them in trust, instead of outright, can protect these assets from irresponsible behavior. Also, you can provide them a stream of income and not stifle their initiative.

Do you have a successful child who is in a “high risk” profession? Perhaps, you have a daughter who is a surgeon. This profession brings with it a significant exposure to liability from lawsuits. Leaving assets to such a child in trust, instead of outright, can protect these assets from future lawsuits.

While there are many tax related benefits that can be achieved with proper estate planning and use of trusts (like avoiding estate taxes and deferring income taxes), a carefully tailored trust can accomplish many non-tax objectives, see above, that will protect and preserve your family wealth.

Mark F. Winn, Master of Laws (LL.M.) in Estate Planning, a local asset protection, estate planning and elder law attorney. www.mwinnesq.com