Estate Planning

Paper Summary:

This paper explains that a trust is best described as a safety box where an individual can hold assets before they are released to the people or organizations designated to receive them; however, this safety box is established in the form of a deed and is a separate legal entity. The author points out that a valid will stipulates to whom assets should be distributed; a living will stipulates what life-saving medical procedures are desired in the event a person becomes physically or mentally incapacitated. The paper stresses that the gift-tax exclusion, which enables an individual to give away, tax-free, $11,000 a year (indexed for inflation) to each beneficiary, is one of the simplest and most inexpensive strategies for saving estate taxes.

Table of Contents
Introduction
Estate Planning Strategies
Trusts
Living Trust
Testamentary Trust
Offshore Trusts
Charitable Trusts
The Will
The Annual Gift-Tax Exclusion.
Medial and Tuition Payments
Nevada Corporation
Conclusion

From the Paper:

"One of the most popular and beneficial estate planning documents is a revocable living trust, which allows the settler to keep complete control over his/her assets and ensure that the assets are passed on to the beneficiaries without delay or unnecessary cost. With a revocable living trust, the title of any assets is transferred from the owner as an individual to the trust but the owner does not relinquish control, meaning he or she can still buy, sell, transfer or borrow. The trustee manages the assets for the benefit of the beneficiary. With living trusts, the trustee is often the settlor. In this case, when the trustee dies, a successor trustee steps in and takes control of the management of the assets for the benefit of the beneficiaries. The assets do not have to pass through probate because they are no longer in the owner's name as an individual. Instead, they are titled in the name of the trust. The beneficiary can receive the benefits from the trust without the need for court and hiring an attorney."

More papers on Estate Planning:

• Essay # 115107 : "Trusts and Estate Planning"
• Essay # 24445 : "Estate Planning"
• Essay # 18338 : "Life Insurance as an Estate Planning Tool"

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