Trust Planning

A trust is an arrangement whereby one or more persons (trustees) take title to property to hold it for the benefit of one or more beneficiaries.

As part of overall financial planning, we identify trust solutions for many situations, including but not limited to estate planning, probate avoidance, college planning, asset protection, generation skipping, Medicaid planning, special needs, and charitable planning. The recommendations are referred to attorneys for drafting documents. Here are some of the trust solutions in brief outline a client might consider:

Type of Trust	Purpose
Revocable or living trust	Avoid probate; establish testamentary trusts
Bypass family or credit shelter trust	Avoid estate tax for surviving spouse
Intentionally defective irrevocable grantor trust	Avoid estate tax but cause income tax to be assessed on the grantor, reducing grantor’s estate
Nominee real estate trust	Avoid probate on real estate holdings
Qualified subchapter “S” trust	Avoid probate on “S” corporation stock
Qualified personal residence trust	Avoid estate tax on residence
Qualified domestic trust	Entitle noncitizen spouse to the marital deduction
QTIP trust	Allows the executor or executrix to divide estate assets to maximize estate and income tax savings
Irrevocable life insurance trust	To keep life insurance out of an estate
2503(c) trust	To keep assets out of parent’s estate and to fund college
Special needs trust	To allow assets to be held for benefit of a special needs child while preserving government benefits
Generation skipping trust	To utilize the lifetime gift tax exclusion and generation skipping tax exclusion to remove assets from parent’s estate to a generation below the children (of the parent)
Charitable remainder annuity trust (CRAT)	Used to pass assets from the estate to a charity while providing income for the life of the grantor
Charitable lead annuity trust (CLAT)	Used to pass income to a charity during lifetime while passing assets to one or more non-charitable beneficiaries at death of grantor
Charitable remainder unitrust (CRUT)	Same as a CRAT except income is a fixed percentage paid to the grantor
Charitable lead unitrust (CLUT)	Same as a CRUT except a fixed percentage is paid to the charity
Grantor retained annuity trust	Used to pay a fixed amount to the grantor with assets passing to beneficiaries at death