King & Snohomish County Washington Trusts Attorney
A trust is a fiduciary arrangement allowing another party or trustee to hold certain assets on behalf of a beneficiary or beneficiaries, and a Lynnwood estate planning lawyer can help you design a trust to protect all of your assets right now. Whereas a will takes effect upon a person’s death, a trust may be applicable both during the life and after the death of a creator.
A living trust is created during a grantor’s lifetime, while a testamentary trust is created after death in accordance with directives in the person’s will. The assets in a trust could also pass outside of probate, which can save your family time, court fees, and estate taxes.
Types of Trusts
There are multiple kinds of trusts, including:
- Revocable Trusts — Also known as revocable living trusts, these are created by grantors during their lifetimes and are primarily used for incapacity planning purposes to avoid probate when they die. A revocable trust does not have creditor protection or tax savings benefits, but the grantor can change the trust at any time, terminate the trust, and have free access to the assets.
- Irrevocable Trusts — Grantors create these trusts for the benefit of others (frequently grandchildren) and are primarily used to hold lifetime gifts for the beneficiaries and receive assets following the grantor’s death. Tax planning and asset protection are two reasons irrevocable trusts can stay in place for multiple generations, as the grantor can have some control through the terms established in the trust document and generally cannot change the trust in any meaningful way.
- Special Purpose Trusts — A special purpose trust will provide for children who are struggling with mental illnesses when they may not have the ability to make independent choices about how funds should be spent.
- Charitable Trusts — This is an irrevocable trust that benefits charities while also providing an economic return for a grantor or their beneficiaries. There are several tax law requirements relating to these trusts, possibly establishing for the life of an individual or a specified number of years. A grantor will transfer assets to the trust and support regular payments to charities. After a charitable lead trust’s term ends, there will be a distribution of remaining assets to non-charitable beneficiaries.
- Special Needs Trusts — Similar to special purpose trusts but more common, a special needs trust covers the financial needs of individuals with disabilities. Special needs trusts enable individuals to receive financial support from a trust for particular purposes without jeopardizing their eligibility for federal and state public assistance programs, such as Supplemental Security Income (SSI) or other benefits. Revised Code of Washington (RCW) § 11.107.060 defines a special needs trust as “a trust the trustee believes would not be considered a resource for purposes of determining whether the beneficiary with a disability is eligible for governmental benefits.”
Call Us Today to Schedule a Consultation with a King & Snohomish County Trusts Lawyer
Are you trying to create a trust in King or Snohomish County Washington? Contact a King or Snohomish County trusts lawyer at Bountiful Law to get the best possible legal help.
Our firm can make sure you get the exact type of trust that will serve all of your interests. Call 425.775.9700 or contact us online for a consultation so we can fully examine your case and get a better understanding of what is most important to you.