Estate plans are not just for people that have substantial wealth. Nevada residents that have any type of assets should have an estate plan in place to ensure that their possessions will be disbursed according to their wishes when they are gone. A well-designed estate plan can prevent conflicts regarding the assets and lessen the tax burden of heirs.
There are various types of trusts that a person can use to distribute his or her wealth to his or her children. A trust can be structured so that the beneficiaries receive specified assets at a certain time, such as when they are a certain age. The provisions of a trust can detail how much money can be disbursed and in what manner it can be used.
Trusts are useful estate planning devices for bypassing probate, which can be a very costly and time-consuming process. They also can be used to lessen estate taxes. While the federal thresholds for estate tax exemptions are very high at $5.45 million for individuals and $10.9 million for married people, the thresholds for states are significantly lower.
Assets that are put into a trust will be protected from creditors. They also are excluded from being considered marital property, which means that if a beneficiary were to divorce, the ex-spouse would have no rights to the assets.
People that own an IRA or 401(k) may want to consider using an IRA trust. Retirement funds in an IRA trust will be protected from bankruptcy and managed by a trustee.
An estate planning attorney may work with clients to devise an estate plan to meet their financial goals and protect their assets. A certain type of trust may be used, such as a living trust or constructive trust.