There are many misconceptions regarding Trust Funds, with many assuming that only the ultra-wealthy or older individuals can benefit from these. However, that’s far from the truth, as you’ll find there are many benefits for everyone. If you’re interested in creating a Trust, understanding your options is critical. One thing you may want to establish is a Grantor Trust. If you’re unsure of what this is or what the benefits of this option are, you’ll want to keep reading to learn more about this option and how a Medina County, Ohio Trust preparation lawyer can help you through these complicated matters so you can feel confident in the future of your assets.
How Does a Grantor Trust Work?
When you create a Trust Fund, you are essentially transferring assets out of your name and into the name of the Trust. You also must appoint someone to handle and oversee these assets, known as your Trustee.
As such, when you create a Trust Fund, you are referred to as the Grantor, as you are transferring ownership rights of property to another person. As such, a Grantor Trust means that you are the entity in charge of the Fund, as opposed to appointing another person to manage your assets. You will remain in control of the assets held in the Fund, and as a result, you will be taxed on these assets accordingly. The most common kind of Grantor Trust is a Revocable Living Trust.
It’s important to understand that as the Trustee of this kind of Fund, you must name someone to serve as your successor Trustee. This is critical as if you pass away or otherwise become incapacitated and are no longer able to make decisions for the Trust, the court will appoint someone to act on your behalf.
What Are the Benefits of This Option?
Like all Trusts, one of the most beneficial aspects of creating a Grantor Trust is that it allows you to help your loved ones and assets avoid the Probate process. Probate occurs after a head of an estate passes away, regardless of whether or not they have a Will in place. The courts will oversee the distribution of the assets held in the estate in accordance with the wishes of the deceased or according to the Ohio Line of Succession if there is no Will established.
Another benefit of creating a Grantor Trust is that it allows you to retain control over the assets held in the Trust, which grants you the ability to make changes to the assets or Beneficiary Designations.
If you are ready to create a Trust fund to protect your assets, connecting with an experienced attorney is in your best interest as navigating this process on your own can lead to mistakes that invalidate your wishes. When you need assistance, the team at Krause Law can assist you through these complicated matters to help you feel confident in your future.
