Within your Last Will and Testament document, a lawyer may recommend that you instruct a testamentary trust be established on your behalf. Well, for this, please continue reading to learn the requirements for an effective testamentary trust and how an experienced Broward County trust lawyer at The Probate Lawyers can teach you the benefits of making one.
What is required for a testamentary trust to work?
One way of putting it, a testamentary trust is specified within your Last Will and Testament document as a type of trust to arise upon your death. In other words, as a grantor, you do not draft and enforce a testamentary trust on your own; otherwise, this would be what is known as a living trust. Rather, you appoint a trusted executor to do so on your behalf. Then, you also assign a reliable trustee to manage the assets placed in this trust, and subsequently distribute them to your named beneficiaries the way you instructed within your will.
Of note, this process cannot and will not start immediately after your passing. This is because, first, your will is required to go through the probate process. Here, a Florida probate court may confirm whether your will document is legally valid and enforceable to begin with. What’s more, the court may also impose federal estate taxes and other probate costs onto the assets that must pass through.
What are the benefits of having a testamentary trust?
Many grantors prefer having a testamentary trust because they can get very specific with the instructions they leave behind for their executor, trustee, and beneficiaries.
With this, it is worth mentioning that you may include multiple testamentary trusts within your single Last Will and Testament document. So, for instance, you may instruct that your minor child receives their inheritance once they reach a major milestone, such as when they graduate college or celebrate their first wedding anniversary. At the same time, you may direct that your spouse get their inheritance in small increments, to simulate the earned income you would have used to support them financially if you were still alive.
In the same vein of control, a testamentary trust has the added benefit of modification capabilities at any point during your lifetime. In this sense, it is essentially a type of revocable trust. This may be worthwhile if, say, you welcome a new child or grandchild into your family and wish to include another testamentary trust and divvy up your given assets differently.
Last but not least, one might argue that it is more inexpensive to include a testamentary trust within your will document than to establish a separate revocable or irrevocable living trust. This is because you may be able to do so by only paying for one legal service. At the same time, this may be a big time saver for you, all while achieving a similar outcome.
Before you take any further initiative with your estate plan, we urge you to consult a skilled Broward County estate lawyer. Most definitely, the team at The Probate Lawyers is eager to work with you.
