Plan Early, and Plan to Access Assets That Are In a Trust

In a strange sort of way, estate planning is like going to the gym, going on a diet, or cleaning out that back room. Those do not seem to go together so how are they similar, do you ask? Well, they are all things that we know we should do, that we know are important for our lives, and that we constantly put off. There is no force quite as powerful as the power of procrastination, right?

Indeed, we all want to be in better health, making the gym and a diet important, but it requires a lot of discipline. By the same token, we all want to have peace of mind that our loved ones are taken care of in case something unfortunate happens. But, it requires a lot of discipline to forge ahead and do estate planning, even when considering your eventual demise is not on the top of anyone’s list.  

That being said, engaging in proper estate planning is not as unpleasant as you may think. It certainly is not as grueling as a workout, and not as painful as avoiding chocolate cake. In fact, it can be a pleasant experience when you get help to do your estate planning because it can trigger memories, and solidify plans that you have only had in your head to this point. And again, the peace of mind you will feel after having done your estate planning is well worth the effort.  

So, in this blog, we are going to talk about things you may want to think about when considering estate planning this year. In fact, this year is an election year, so your estate planning may be somewhat connected to the policies being discussed right now in real-time.   

After reading this article, if you have more questions about estate planning in your own life, we invite you to call the seasoned estate planning attorneys in West Palm Beach at Doane & Doane at 561-656-0200 . Let us be your South Florida legal guide.

Every election brings a bit of uncertainty. Depending upon who ends up in the White House, policies with regard to taxes and other monetary issues can change. With a Democratic-leaning government, it is possible that the estate tax could change considerably. If a Republican-leaning government is in charge, then that could guide other investment and planning choices.  

Just as an example, back in 2012, there was some expectation that the estate tax exemption could drop from about $5 million to $1 million. Acting on that possibility, many taxpayers made estate plans to take advantage of that potential change. Specifically, taxpayers made large gifts, using the exemption, and placed the money in irrevocable trusts. They later regretted the move because now a large sum of money was not easily accessible, or accessible at all.  

After any “buyer’s remorse” by speaking with an estate planning attorney sooner rather than later to run numbers to see what happens under different scenarios.  

There are a few tools that estate planners use to ensure people still have access to money that is purposely taken out of an estate for estate planning purposes. Here are a few:

1. Spousal Lifetime Access Trusts, or SLATS . This kind of trust that one spouse creates for the other. Each spouse can have such trust, and each spouse can be the beneficiary of the other’s trust. However, trust cannot be reciprocal. If they are sufficiently different you can feel comfortable that the trust instructions will be enforced at the end of the day.   

2. Domestic Asset Protection Trusts, or DAPTs . These are self-settled trusts, in which you are both a grantor and beneficiary. About 19 states allow for this kind of estate planning trust. The trust will be administered by an independent trustee, and through it, you, and several other beneficiaries, can have access to the trust assets provided it is allowed by the trustee. 

3. Hybrid-DAPT . As you would expect, this trust is a different version of a DAPT. This type of trust does not initially name you as a beneficiary. Rather, someone (not the trustee of the trust) is given the authority to add new beneficiaries to the trust, and you (the grantor) can be added as a new beneficiary. The trust would not be self-settled from the get-go, but once added as a beneficiary, you may be able to have access to the assets.

4. Special Power of Appointment Trust, or SPAT . With this type of trust, a person is given the authority to direct the trustee to make a payment to you (the grantor). You are not a beneficiary of the trust, however. So, the SPAT will not be considered self-settled, and the SPAT will avoid some of the risks that many associates with self-settled trusts.  

There are even more ways in which to ensure that you will have access to your assets in a trust, even if they are no longer officially part of your estate. For example, if you create a grantor trust, in which you pay the income tax on the trust earnings, you can direct someone else to have the authority to grant you loans, perhaps without needing security. 

Whether it is assistance to administer an estate or assist an appointed personal representative, you should engage the help of the  South Florida legal guides at Doane & Doane.  

Florida fiduciaries seek the assistance of the attorneys of  Doane & Doane, P.A. to administer and manage their trusts and estates frequently. The founding partners of Doane & Doane are board-certified West Palm Beach Probate Attorneys . With the additional advantage of certified public accountancy in their backgrounds, they present a unique combination of skills and experience which enables them to effectively settle, administer, and manage clients’ trust and estates.

In short, at Doane & Doane, we have the resources and experience to help you understand all aspects of the probate process. Doane & Doane’s probate attorneys in West Palm Beach can be your South Florida legal guides. 

 If you think it is now time to get started on your own estate plan, or want to learn more about incentive trusts , give us a call at 561-656-0200 .  

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