President Obama issued a proposal at the 2015 State of the Union Address that would have closed loopholes available to those with assets in a trust. Currently, if assets are passed on to heirs, the heirs get what is called a step-up in basis. In other words, their cost basis is the current price of the asset instead of what it was worth when it was first purchased.
Individuals in Nevada who are planning for the ultimate distribution of their estates and whose only significant asset is real property may be able to avoid probate altogether by using some other methods of transferring property in place of a will. Probate can be expensive and time-consuming, so individuals may wish to consider changing the title in some way that will allow the real estate to pass straight to the beneficiary. One way of doing this is by creating a living trust. The property is transferred into the trust and retitled accordingly. A living trust permits the individual to keep control of the asset.
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.
As many Nevada residents may know, there are several ways to save money on taxes. In some cases, the family will pay a lower estate tax and, in others, the asset owners will owe less in income tax. Knowing the intricacies of such opportunities and using them may be beneficial.
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.
Estate planning is an important topic that newlyweds in Nevada should take the time to discuss even though it may be far from their minds. After getting married, spouses should update their estate plans so that they are prepared for the unexpected.
When people in Nevada are planning how to handle their estates, it is important to make certain the documents drafted are written in such a way to make them unassailable in future will and trust contests. When an interested party to an estate mounts such a contest, expenses can substantially increase, depleting the total amount held by the estate.
Nevada and 12 other states provide various legislation to help individuals protect their assets through the use of trusts. More states have begun to embrace these special kinds of trusts in order to build upon existing financial planning methods and to attract foreign capital. Asset protection trusts do not actually hide assets or avoid income taxes. However, they may be able to reduce the impact of income taxes in certain limited circumstances or in conjunction with other estate planning methods.
While parents likely have good intentions in mind when setting up a willing and leaving inheritances, common estate planning mistakes can make a process that is already difficult for some to talk about more complicated. Those in Nevada who have started considering their estate plan may be able to avoid complications by considering a few possible issues.
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.