Irrevocable Trusts - The benefits
It's easy to setup an irrevocable trust and get major financial benefits.
You can put most assets into an irrevocable trust including investments and real estate.
Your trustees, which are usually your children, can take money out anytime tax free. So this is a superb way to give them their inheritance tax free.
If you ever need Medicaid you will qualify because you have no assets. But remember that Medicaid has a 5 year lookback. BTW: in NY State retirement accounts such as IRA, 401k and 403b are not considered assets for Medicaid purposes and do not have to be spent down to qualify for Medicaid. So these accounts do not need to go into a trust.
If the Trust generates income you can take the income. I do this and it makes a big difference.
One more nice benefit. In many States an irrevocable trust is a powerful tool for avoiding probate. When you place assets into an irrevocable trust, you are legally transferring ownership of those assets from yourself to the trust. Because you no longer personally own those assets at the time of your death, they do not have to go through the probate process.
Many thanks to Attorney Karen Tobias (845) 876-3300 for helping me with this post. Karen is a Trust expert. In addition to the Trust, Karen also gave my wife and myself Wills, Power of Attorney and Healthcare Directive. All for under $7K. Amazing. Mention my name for VIP service.
Tech Notes:
Disclaimer: This is not intended as legal or financial advice. It's for informational purposes only. For advice consult an attorney.
Content written and posted by Ken Abbott abbottsystems@gmail.com
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