Why do you need a trust in San Diego and how can it save you a substantial amount of money? A trust provides protection for your assets, investments and accounts and provides an additional layer of separation between an individual and any creditor seeking to collect against a liability or debt. Transferring assets such as bank accounts, your house, investments and even business interests into a revocable trust allows a person to maintain complete control over these assets, while making it much more difficult for creditors or other parties to find or attach. The use of a revocable trust or irrevocable trust are based upon the disposition of assets and the unique circumstances our clients face.
Another primary benefit of a trust is the ability to avoid probate. Without a trust all assets must pass through probate at the time of your passing. The costs of probate court are substantial, and are based upon the appraised value of your assets and not the equity they carry. For example, if you own a home that is valued at $500,000 and there is only $100,000 in equity remaining in the house, probate costs are based upon the $500,000 appraised value and not the $100,000 net worth. Probate fees on a $500,000 will exceed $25,000 and the process of clearing the asset from the court so that it may be sold will almost always require a year or more. In these cases, your assets are tied up for an extended period of time and are significantly diminished by the costs of probate including probate court fees, executor fees, attorneys fees and other related costs.
Finally, a trust allows those approaching retirement and ultimately long-term medical care to qualify for Medi-Cal benefits while retaining ownership of assets such as your home. Without a trust an elderly person who required treatment in a nursing home or skilled nursing facility could be forced to sell their home and surrender part or most of the proceeds to Medi-Cal. There are complex laws and rules regarding Medi-Cal eligibility, look-back periods and trust related timing requirements. Why do you need a trust in San Diego and how can it help you at almost any step in your life? The experienced estate planning, trust and tax attorneys at Allen Barron provide a free and substantial consultation for those with questions about establishing a trust, or modifying and existing trust at 866-631-3470.
