Do I need a Revocable Living Trust?

The answer to this question can depend upon the following factors.

1) What is the size of your estate? An estate consists of real property, life insurance, retirement, cash, securities and personal property. In Arizona, a probate will be triggered if you pass away with assets in your name totaling more than $75,000. This limit can be reached quite easily with a modest sized estate. However, a probate can be avoided with a properly drafted trust.

2) Would you like asset protection for your family? During your life, a revocable living trust will not protect you from creditors or divorce. However, if you are married- after the death of the first spouse, the surviving spouse will have asset protection from creditors, divorce and Medicaid spend-down; and your beneficiaries will have the same protections at the survivor’s death.

3) Are your potential beneficiaries under the age of 18? Without a trust, if your beneficiaries are under the age of 18, a conservatorship would have to happen in order to hold the minor’s share until the beneficiary reaches 18. The biggest question you have to consider is whether your beneficiary is mature enough to receive their share at age 18.  A trust will allow for your beneficiary to receive their share at a designated age that you choose.

4) If you have an estate that would be subject to State Estate Taxes or Federal Estate Taxes? With the federal estate tax exemption set at $5.34 million today there are very few Americans that will be subject to the federal estate tax, but many may still be subject to state estate taxes.  Most states that have a state estate tax have exemption amounts that are much lower than the federal estate tax exemption amount.  With a properly drafted trust you can minimize or even avoid having to pay state estate taxes and if your estate is large enough, federal estate taxes.

5) Do you have beneficiaries with special needs? If one of your beneficiaries is receiving government benefits, the last thing that should happen is for the beneficiary to have their benefits cut off due to receiving the inheritance. A properly drafted plan would ensure that the special needs beneficiary will receive the estate share and be able to continue receiving government benefits.

Of course, these are just a few factors that need to be addressed when considering which estate plan is the best plan for you and your loved ones. If it has been more than 3 years since you have seen your estate planning attorney regarding your existing plan, or if you don’t have a plan in place, it’s time for you to put this important planning at the top of your to-do list -  your family will be glad that you did!

What the Attorneys of Morris Hall Can Do For You:
The attorneys at Morris Hall have 100’s of years of combined experience ensuring that families’ assets are protected from probate, unnecessary taxes, creditors, ex-spouses and Medicaid spend-down.  The attorneys also help those in Arizona and New Mexico to apply for and receive Medicaid assistance and Veterans Benefits.  Our Arizona offices are located in Phoenix, Mesa, Scottsdale, Cave Creek, Tucson, Prescott, Flagstaff and Arrowhead.  Our New Mexico offices are located in Albuquerque, Las Cruces and Santa Fe.  Contact us today at 888.222.1328 to schedule an appointment!

This blog should be used for informational purposes only.  It does not create an attorney-client relationship with any reader and should not be construed as legal advice.  If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.