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Basics About Third-Party Special Needs Trust
Estate planning is critical to parents who have a minor or adult disabled child that receives government aid programs. The purpose of estate planning is to distribute one's assets smoothly and cost-effectively. Generally, assets include real estate, life insurance, retirement assets, bank, and savings accounts among other things
One of the key roles of an estate planning lawyer is to assist you and your family to anticipate issues, which may arise because of your death or incapacity. Estate planning is more important for parents who have one or more children, which receive government benefits such as social security disability income.
TWO TYPES OF DISABILITY INCOME
According to the Social Security Administration, The Social Security Administration or otherwise known as “SSA” administers two types of disability programs
FIRST TYPE OF DISABILITY PROGRAM: SOCIAL SECURITY DISABILITY INSURANCE
The first type of disability program is “Social Security Disability Insurance”. Social Security Disability Insurance is designed for disabled individuals who worked sufficient time to pay into the insurance system. Thus, the disabled person worked for a period where they paid into the “insurance system” to receive a benefit for becoming disabled. This type of disabled individual receives insurance and is not needs-based. An inheritance will not disqualify a recipient from government-based benefits due to them working a sufficient period to qualify for the insurance program. Paying into social security disability is like paying into unemployment insurance. An individual works enough time to gain a benefit from the insurance program designed to assist people that become disabled later in life.
When is the Best Time to Set Up a Third-Party Special Needs Trust: Testamentary Special Needs Trusts v. Stand-Alone Special Needs Trusts
Special needs trusts are designed to financially provide for disabled loved ones without impacting the disabled person’s eligibility for governmental assistance programs. There are two types of special needs trusts and the type of trust that you create will determine a number of key factors related to the disabled person receiving the benefits of the trust.
Testamentary Special Needs Trust v. Stand-Alone Special Needs Trust
The first type of special needs trust is called a testamentary special needs trust. This type of trust is created by including certain language in the creator’s will or trust. A testamentary special needs trust does not go into effect until the creator of the will or trust dies.
Alternatively, there is a stand-alone special needs trust. A stand-alone special needs trust (also called a free-standing special need trust) is effective as soon as it is created.
Important Factors to Consider When Determining the Right Special Needs Trust for You
Accessing Benefits
A stand-alone special needs trust allows for assets to be transferred to the trust immediately and gives the creator of the trust the ability to have control over the assets that are included in the trust while they are alive. Additionally, the beneficiary of a stand-alone special needs trust can have access to its funds immediately. With a testamentary trust, the beneficiary must wait not only until the creator of the trust passes away, but they may have to wait even longer due to the probate court process.
Estate Planning: Gun Trusts
Kendall County Gun Trust Lawyers: Serving Plainfield, Yorkville, Oswego, Plano and Surrounding Areas
What is a Gun Trust?
A gun trust (also called an NFA trust) is a type of trust designed to take title of your firearms and certain firearm accessories. As creator of the trust, you will name a person as trustee that will manage the firearms in the trust. If you name yourself as trustee, you will also name a successor trustee that will manage the firearms should you become incapacitated or at your death. Gun trusts can be revocable or amended by you, the creator, which is specified in the terms of the trust.
Firearms that are covered under the National Firearms Act and Gun Control Act of 1968 qualify for this type of trust. Types of firearms covered include fully automatic firearms, short-barrel shotguns, short-barrel rifles, and any other weapon or device that a person can hide on their body that discharged an explosive. Along with those firearms, the qualifying firearm accessories include sound suppressors and destructive devices (for example, grenades or bombs). A gun trust provides a number of benefits for gun owners interested in protecting not only their firearms, but also those who they wish to inherit their firearms after their death.
Estate Planning: Naming Guardians for Your Children & Children’s Trusts
Naming Guardians for Your Children in Your Last Will and Testament
Any experienced estate planning attorney will emphasize the importance of naming guardians for any current or future minor children when drafting your will. It is important to make sure the person (or people) you want to take care of your children in the event that you pass while they are still minors (under the age of 18) so that your wishes are followed. If no legal guardian is specified in your will, this huge decision is left up to strangers (the court).
It is custom that if one parent passes and there is a surviving parent, the surviving parent has the legal right to custody of the children. If possible, it is ideal that both parents are in agreeance of custody of the children should one or both pass while the children our minors. However, it is sometimes the case that both parents cannot agree. In any event, your wishes should be clearly stated in your will, so the court is clear on your wishes.
What is a Limited Liability Company (LLC)?
You may be wondering what an LLC is. Well, an LLC is short for Limited Liability Company.
LLC is the common business structure for private companies in the US that protects its’ owners from personal responsibilities from debts or liabilities.
Typically, any budding company, small business, or even a tech startup can emerge as an LLC. Microsoft, Nike, Adidas, Berkshire Hathaway, and AOL are all LLCs.
In this post, you will get to fully understand what an LLC is, its advantages and limitations, and how you can set up a limited liability company. Read on.
What is the Purpose of Estate Planning and a Living Trust?
Oswego and Yorkville Living Trust Lawyers
There are many different goals possible to be accomplished with an estate plan, depending on your situation. A good estate plan will ensure that your loved ones are in the best position possible from both a financial and personal perspective if you pass away or become mentally incompetent. When you start to plan your estate, you need to consider your assets, beneficiaries and goals. You should then consult an estate planning attorney who can advise you on ways to save money and taxes and ensure that your will or trust legally provides for your beneficiaries in the manner you direct.
Call Peace of Mind Asset Protection, LLC at 630-780-1034, we are here to serve you and listen to your needs. If you have recently had an important life event—marriage, birth of a child or grandchild, divorce, death of a beneficiary, an inheritance, and/or purchase of a new asset—you will want to update your estate plan accordingly.
Executor Responsibilities during a Probate Proceeding
Kendall County Probate Lawyers
A person appointed to the role of Executor during a probate proceeding has the responsibility of dividing and distributing a person’s assets when that person passes away. There is a lot of legal jargon involved and it may be an intimidating task. It is important to understand what goes into the role of Executor and what the process looks like. This makes the process much easier and smoother for the Executor.
Cost
The Executor does not pay for the cost of the probate process. It is paid by the assets of the estate. Costs typically come in the form of attorney fees, court filing fees, and any appraisal needed.
Kendall County and Oswego Probate Procedures
What is Included in the Probate Process?
The first thing to understand is what a probate is and how the process works. Probate is the term used for the legal process in which a deceased person’s Will or Estate (without a Will) is administered. The process looks different depending on whether the person who is deceased had a Will made while they were alive or if they did not. In the event the deceased person did not have a Will made, a person is selected to be an administrator of the Estate. The Executor, among other things, has the task of compiling a list or inventory of the assets of the Estate. The Executor also must make sure any claims that are made against the Estate are paid, and finally, the Executor must distribute whatever is left of the Estate to the appropriate heirs of the deceased.
Only Two of You? Estate Planning Tips For Childless Couples.
What if you don't have children yet, is estate planning still necessary for you and your spouse? Frankly, death or a terminal sickness can come knocking anytime even before you both decide to have children. So, you ask yourself, "is estate planning ideal for childless and infertile couples?" The answer is yes.
Estate planning is not only for couples with children. In fact, many estate planning documents do not contain children as beneficiaries alone. Other like pets, extended family members, and even distant relatives as beneficiaries are also included.
Coordinating Landlord’s Estate Planning With Asset Protection
Owning rental property can be a great benefit to a landlord, as well as a way for an individual to generate additional income. But there are substantial risks that an individual assumes when taking on the role of a landlord. The risk of a lawsuit against a landlord is high, as there can be claims brought based a lease dispute or an injury that occurred on the property. If a tenant brings a claim against a landlord, judgment creditors will be able to access the landlord’s personal assets to pay off the judgment. In order to protect personal assets, it is crucial to include rental property in an estate plan as a way to structure a workable asset protection plan.
The best way for landlords to eliminate the risk of creditors reaching personal assets is to take the rental property out of the landlord’s individual name and place it into an entity. There are two ways that are most effective at doing so, establishing an LLC, or putting the property into a land trust.
Why A Certificate of Trust Is Necessary In Estate Planning
Implementing a Trust into your estate has many advantages. Along with being a less costly alternative than going through Probate and being more time-efficient, A Trust has the added benefit of being private. However, when a Trust has been implemented, you need to provide documentation of the Trust when opening new accounts or purchasing real estate. That is where a Certificate of Trust comes in handy.
Privacy of a Trust
While a Will must go through Probate and will become a public document, a Trust Agreement has the benefit of remaining private, meaning that only those that have seen the Trust know the contents of it. Mainly, the people who are aware of the contents of the Trust are the Trustees and Successor Trustees.
Role of Trustees
The Trustee has the power to manage the Trust. Typically, while the Trustor (the person who created the trust) is alive, they will serve as Trustee. Doing so gives the Trustee full ability to add assets to the trust, make payments on behalf of the trust, and remove items from the trust as necessary to benefit the Trustor during their lifetime.
Questions?
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