Everyone knows the importance of drafting Wills, but it can be difficult to negotiate the legal ins and outs relating to leaving one’s Estate to intended heirs or beneficiaries, and one of the most important is the decisions between leaving a Will or setting up a Family Trust.
- Family Trusts do not require probate (the process – overseen by courts – legally required for the execution of a Will, or for Estate administration in cases where Estate must be passed on to heirs when there no Will has been left). Trusts are considered legally-binding contracts between private parties and are not a matter of public record. Therefor they do not require court oversight.
- Privacy. Related the above, if you don’t want the world to know what you owned and what you have bequeathed, a Trust is the better option over a Will. Trusts are only open to public scrutiny if they are challenged.
- A Trust’s contracts can come into effect if you become mentally incapacitated, with the Trustee taking over your affairs for the protection of your Estate - not the beneficiaries, as the Trust will only be administered on your death. This would avoid another long court-process; if you have drawn up a Will, your beneficiaries would have to go through the courts to appoint a guardian to manage your affairs.
- Trusts can also include provisions for your care prior to death, in cases for incapacitation or other mental/physical disability. This cannot be done with a Will.
- Properties left in Trusts are not subject to the same taxation as those left through Wills.
- Trusts can provide Creditor protection.
- Family Trusts can be administered after your death. Irresponsible or underage heirs won’t be able to abuse what’s been left to them and/or won’t need to deal with the administration of assets when they either can’t, or don’t wish to.
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- Wills are better than Trusts, or should be done in addition to Trusts, in cases where a Trust won’t necessarily hold within it all properties at the time of death.
- Only Wills can name your chosen Guardians for the care and financial oversight of the inheritances of minor children.
The above is far from comprehensive, and your best bet is professional advice on what would be right for you and your Estate Planning. TAT can provide both the financial (especially taxation)and Legal savvy when it comes to protecting your Families future wealth. Please don't hesitate to contact us and make an appointment, we are here to assist you.