The uses of trusts and trust modifications

On Behalf of | Mar 13, 2020 | Trusts

People in Nevada who are creating an estate plan may want to include a trust as part of it. A trust may be revocable or irrevocable. The former can be changed by the creator, also known as the settlor. The latter usually cannot. Irrevocable trusts remove assets from the settlor’s control, but increasingly, there have been efforts to find ways to allow them to be modified as well.

Trusts can serve a number of different functions. They may protect assets for individuals who manage money poorly or who are dealing with substance abuse problems. They may be helpful in blended families to ensure that children from previous and current relationships receive assets. They may protect assets from tax, but the laws around gift and estate taxes have changed a number of times and may continue to do so.

Trusts may have multiple trustees. For example, a family member may be a trustee along with one or more financial professionals. It might be possible to make even irrevocable trusts more flexible by appointing trust protectors or giving certain trustees some discretion. Nevada is one of several states that does permit a trustee to make some changes to irrevocable trusts through a process known as decanting, but this is complex, and an attorney may be able to help.

Even people who do not think a trust would be useful as part of an estate plan may want to consult an attorney to discuss the issue. Trusts may be helpful in a wide variety of circumstances and at various income levels. For example, a special needs trust can provide assistance to a family member with special needs without endangering that person’s access to government benefits.