A document that is created by the legal entity or grantor to indicate how to transfer ownership of specific assets and who to designate as a trustee to oversee those assets for the advantage of the beneficiaries.
Asset Protection Trusts provide protection for your assets against creditors of yours or your beneficiaries. These trusts are designed to safeguard assets from nursing homes, legal actions, divorces involving children, and other creditors while you are alive and after your death. They are not intended for tax purposes, but rather for individuals who are not worried about federal estate taxes upon their passing (presently set at $12.92 million for individuals and $25.84 million for couples). The main advantage is that you retain control of the trust while ensuring the protection of your assets throughout your lifetime and beyond.
The objective of a trust can assist in determining who should serve as Trustee. If the trust is a safeguarded trust, the beneficiary should not act as a Trustee, but requesting a relative of the beneficiary, particularly a sibling, to serve as Trustee may create additional complications. If the trust primarily aims to protect assets, the beneficiary may act as Trustee, but in certain cases, for optimal protection, it is preferable for an impartial individual or a Trusted Corporation to serve as Trustee or co-Trustee alongside the beneficiary.
A Trust is a legal document that is similar to a Will. The difference is that this document is created for the purpose of avoiding probate and creditors.
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