While people may have heard of A-B trusts, they may not know what these trusts are or why they are used. These trusts are established by married couples in order to help avoid double-taxation after one spouse dies.
In a decision released on Feb. 13, the Internal Revenue Service set standards regarding issues about the gift tax, clarifying whether contributions to a trust are completed gifts. The letter also discussed whether the fair market value of property held in trust was included in a trustor's estate. This federal letter ruling may affect some estate plans in Nevada.
Las Vegas residents with an interest in estate planning issues may be interested in an article detailing one method for updating a trust after it has become irrevocable. This method may have tax consequences, good or bad, so professional guidance should be sought.
One of the most common assets that an individual will hold is a life insurance policy. However, they can be problematic when it comes to estate planning. One way to get around these issues is to create an irrevocable life insurance trust. What the trust will do is hold the insurance policy outside of the estate. At the same time, it still allows an individual control over who gets to benefit from the policy.
At times, a person may want to leave a trust for the benefit of an intended beneficiary who, for whatever reason, is unable to control his or her own spending. In those cases, the person creating the trust may do so under the law by establishing a spendthrift trust.
When people create trust accounts in Nevada, they normally do so with specific purposes in mind. There are certain common errors about which people should be aware so they do not make them, thereby subverting the purposes they had for starting the trust to begin with.
Nevada families of mentally ill or disabled individuals may wish to learn about special needs trusts. This type of trust is designed specifically for individuals who may be unable to care for themselves. A family member usually manages the trust for the beneficiary.
Individuals in Nevada who are estate planning may wonder about the role of trustees and how they will handle debts and expenses. The trustee must take responsibility for valuing all assets as soon as possible after an individual's death as well as for assessing all debts. A trustee also acts as a fiduciary and may be a beneficiary as well.
Management of your trust is important as you plan not only for your future but also for the futures of those who will inherit your estate. However, deciding on the administration of your trust can be challenging as you select a trustee. Confidence is an important aspect of this decision, but it is also important to evaluate the management abilities of a fiduciary to ensure that decisions will be made objectively and beneficially.
The creation of a trust can be beneficial in estate planning for persons in all walks of life. While many consider a trust to be a tool reserved for people with very large estates, the truth is that a trust may also be a good choice for people with more moderate assets, according the National Association of Financial and Estate Planning.