To set up a trust, hire an attorney, select a trustee and beneficiary, and decide on the type of trust that is best for your situation. Trusts are not only for the wealthy, but for anyone who wants to maximize tax exemptions while passing on assets in a specific manner.Continue Reading
Find an attorney who is licensed and experienced in creating trusts and handling estate planning. Although attorney's fees are high when creating a trust, working with an experienced professional helps you get the maximum benefit from a trust.
Choose a trustee such as an attorney, a bank's trust department or another entity to handle the trust. Include a trustee removal clause in the paperwork so that the beneficiary can replace the trustee if service is unsatisfactory. Choose the beneficiaries to whom you want to distribute the assets and in what manner you want them to be distributed. Beneficiaries are typically children, grandchildren, spouses or organizations.
Tailor the trust to meet the needs of the beneficiary and reflect the state of the assets. Living trusts are those set up while the grantor is still alive, while testamentary, while after-death trusts take effect upon the death of the grantor. Irrevocable trusts cannot be changed but have significant tax benefits. Revocable trusts can be modified, but the beneficiaries are liable for taxes.