When you create a trust, your goal is usually to provide protection for the assets you put into the trust. There are different kinds of trusts that can protect your assets from different risks and that protect your property in different ways. For example, certain trusts can keep your property safe in case of your incapacity, from misuse by irresponsible heirs who are bad at managing money, or in case you have to enter a costly nursing home. There are many different reasons for creating a trust and each different kind of trust has its own pros and cons.
If you are thinking about creating a trust, you need to understand how trust law works and what trust creation involves. You should know how creating a trust will impact your assets and what will happen to the property you put into a trust. Parman & Easterday can advise you about all aspects of creating a trust and help you make informed choices. You should give us a call to talk with an Oklahoma City trusts lawyer who can help you.
What Happens to Assets When Creating a Trust?
When creating a trust, you have to transfer your assets into the trust. Unless and until you officially change the ownership of assets to the trust, you will not achieve the desired level of protection for those assets.
Once the assets are officially transferred to the trust, the trust becomes the legal owner of the property. Your own involvement with the trust assets, and the degree of continued control you have, will vary depending on the kind of trust you create and the instructions you provide in your trust document.
In general, when you create a trust, you must name a trustee. The trustee has a fiduciary duty to manage the assets you put in the trust. Sometimes, you can name yourself as the trustee and name a backup trustee, which allows you to maintain control over your assets unless or until you become incapacitated or pass away. This is commonly what occurs when you create a living trust.
In other situations, such as when you create an irrevocable trust, you may name someone else as trustee and let that person take over asset management. If you want an irrevocable trust to protect your assets should you need nursing home care or if creditors should come after you, you may need to give up substantial control over the assets you are seeking to protect through transfer to the trust.
You also will name a trust beneficiary or beneficiaries when you create a trust. These beneficiaries are the people for whom the assets are managed, and who will benefit from the money or property transferred into the trust you created.
Why You Should Get Help Creating a Trust
Understanding what kinds of assets you can put in a trust, and what will happen to those assets, is vitally important. You do not want to end up costing yourself money by losing out on important tax benefits. Nor do you want to be surprised when the bank calls a mortgage on investment property and expects you to pay off the balance right away because you transferred the property into a trust.
There are many rules to follow regarding the transfer of assets into a trust, and the requirements of how trust assets must be treated will vary depending upon the kind of trust you create. An experienced attorney who understands how the law applies should be consulted to advise you both on the trust creation and on what will happen as you move your assets into a trust.
Getting Help from An Oklahoma City Trust Creation Lawyer
Parman & Easterday understands the ins-and-outs of trust creation in Oklahoma City. We have provided assistance to many clients in creating different kinds of trusts to accomplish their asset protection and estate planning goals.
To find out more about trust creation and what is involved in creating a trust, you can join us for a free seminar. You can also give us a call today at (405) 843-6100 or contact us online to speak with an Oklahoma City trusts lawyer about the ways in which our legal team can assist you. Call now to get your trust creation process started.