There are several common mistakes people in Michigan would do well to avoid regarding estate planning. Some of the mistakes may be corrected if they have already been made, but it's best to fix any problem as soon as possible so it does not become too late.
Michigan residents working on their estate plan might be interested to learn about the various types of trusts that are available. To begin, a person can set up both living trusts and testamentary trusts. A living trust goes into effect during the benefactor's lifetime, and a testamentary trust does not go into effect until after the benefactor's death.
For certain individuals, trusts can be an advantageous and inimitable estate-planning tool, authorities say. People who have estates worth more than $100,000 and possess complex real estate holdings, art collections or business holdings may find a trust to be very beneficial. Others worth at least $100,000 who have a disabled relative whose needs they wish to ensure even after they themselves pass away may also wish to set up a trust, which will avoid negatively impacting their relative's eligibility for continued disability and health care benefits from the government.
Proper estate planning is an important consideration for many Michigan residents, but it is a subject rife with misinformation that some unscrupulous businesses attempt to exploit. For example, some businesses promote "free lunch" seminars that claim to offer attendees educational information about estate planning over a free meal, but these seminars are often high-pressure sales pitches in disguise. By stoking an attendee's fear of losing their life savings to taxes or court battles, sales agents attempt to sell estate-planning products, such as one-size-fits-all living trusts, that may or may not be suited to an attendee's individual needs.
For some Detroit residents, the trust may be an essential part of a durable estate plan that results in both tax savings and timely fulfillment of final wishes. Others will find that their needs are better met through other tools of estate planning. Before researching the options of a living trust, special needs trust or other types, benefactors may be best served by understanding some guidelines.
One of the key goals of estate planning for individuals and couples is to reduce the tax burden on the estate as much as possible, allowing more of the assets to pass to heirs and beneficiaries. This is more difficult when an estate is large, but one of the tools used to protect the value of assets in such cases is known as a bypass trust. This type of trust utilizes different strategies to take advantage of several tax deductions, and when a couple uses it, both if their wills contain similar language.
Taking care of a child or family member who is disabled or mentally ill can be a taxing situation for anyone. One way that people in Michigan can make sure their family members with special needs are taken care of is through trusts. A special needs trust is one that can be used to handle assets and inheritances that are going to those who are disabled.
When a person finds out that they are a beneficiary of a trust, a lot of questions might come to mind. Understanding your rights if you have been named as a trust beneficiary can help you to ensure that the trust is operating in a manner that will continue to provide you with the intended benefits. Michigan residents might be interested to learn what rights beneficiaries of trusts have.
For some people who are going through the estate planning process, trying to figure out the best way to set things up is rather difficult. One of the things to consider if you are going through this process is whether a revocable trust is right for your situation. There are several advantages and disadvantages to think about when you are trying to decide if this is an appropriate way for you to set up your estate.
Estate planning isn't something that many people like to think about, but it is something that is necessary to ensure that your final wishes are followed. During your estate planning process, you might have to decide if you need to have a will or a trust. While both documents can be important for estate planning, they are decidedly different. Michigan residents might like to know about how the two differ.