A Trust Can Protect Your Assets, But There Are Certain Limitations
You can use a trust to protect your assets. This way, in the event of your passing, those assets cannot be taken by creditors. Or, for that matter, used to pay for the probate process, which most trusts are able to surpass.
Even though a trust can protect your assets, there are certain limitations that must be honored. Going over these limitations, and speaking with an estate planning lawyer, will help you develop a trust that satisfies your goals.
How Can A Trust Protect Your Assets?
A trust can protect your assets by letting you relinquish your ownership of the assets that were once yours. And, this means that, if you put an asset into a trust, those assets will no longer belong to you.
If you put your assets into a trust – and relinquish ownership of those assets – then certain parties will be unable to access them.
Just as an example, if you owe money to a few different parties, they will have a hard time getting this money. This is because the money they want will no longer belong to you.
In order for you to develop a trust that protects your assets, you must work with a lawyer to set up an irrevocable trust. Other trusts can serve a similar function, but an irrevocable trust is ideal, if you want to protect your assets.
You will need to work with your lawyer in order to transfer the assets you wish to protect in your new trust. This can be a complicated process and, as such, working with a lawyer who can help you is of the utmost importance.
What Are The Limitations Of A Trust When It Comes To Asset Protection?
The limitations of a trust, when it comes to asset protection, are as follows:
- A number of debts cannot be protected through a trust; these tend to include child support, alimony, and taxes, along with a few others.
- You can transfer assets into a trust with the intent of protecting those assets from creditors; but, if you do so with the intent to defraud your creditors, then your assets could become accessible to creditors once more.
- A transfer can be challenged by your creditors, in the event that they believe it to be fraudulent; they have four years to do this, after you make the transfer.
Every single one of these limitations can make it more difficult for you to protect your assets using a trust.
To surpass these limitations, and protect your assets, you should do the following:
- Work with a lawyer who knows how to develop an irrevocable trust.
- Select a person you trust to be your trustee.
- Clarify the assets you wish to protect using your trust.
- Transfer those assets in a manner that is legal.
- Make sure the trust is kept safe, up-to-date, and in alignment with the state of Florida’s laws.
The above will make it easier for you to develop a trust that protects all of your assets.
Speak With A Florida Estate Planning Lawyer Today
If you would like to develop a trust, you must work with someone who can help. Speak with a Florida estate planning lawyer at the Millhorn Elder Law Planning Group today and we will help you develop the trust you are looking for.
Sources:
law.cornell.edu/wex/trust
law.cornell.edu/wex/irrevocable_trust
