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Monday, May 23, 2011 NEET Tips
NEET Tips answers questions posed by visitors to the NEET website
How do you cut off an alcoholic child from an inheritance?
It’s possible to disinherit someone entirely in a will or trust, or to condition distributions from a trust on the alcoholic beneficiary meeting certain requirements, such as sobriety, before a distribution can be made. Establishing a reliable method for determining continuous sobriety may be problematic, but if the parent can settle on language they are comfortable with, the provisions can be enforced through the use of a trust.
Wednesday, April 06, 2011 NEET Tips
NEET Tips answers questions posed by visitors to the NEET website
How do you adjust your estate plan for an ungrateful son?
Some parents disinherit their children with no regrets, others struggle with how to handle this uncomfortable situation. There are several options for dealing with difficult children, including making uneven distributions among your children, altering the timing of distributions, and leaving your children their inheritance in different forms, for example one child could receive their inheritance outright while another receives theirs in trust with a corporate trustee to manage it. With a trust, you could also place conditions on distributions so that the beneficiary must meet certain requirements before distributions are made from the trust. There are many options available, which your estate planning attorney can discuss with you.
For more information on this topic, see the NEET article:
Estate Planning with Difficult Children in Mind Tuesday, April 05, 2011 NEET Tips
NEET Tips answers questions posed by visitors to the NEET website
Can a beneficiary of a trust also be a trustee?
Yes, in some cases, depending on the type of trust. The same person is often both a beneficiary and trustee when creating a revocable living trust. But in other types of trusts, the beneficiary should not also be a trustee. Examples include certain irrevocable trusts where the purpose is to get the assets out of the grantor’s taxable estate. In that situation, naming the same person as both the trustee and the beneficiary could cause inclusion of trust assets in the grantor’s taxable estate, among other problems.
For more information on Trustees, see the NEET article:
Choosing a Successor Trustee
Tuesday, December 14, 2010 NEET Tips
NEET Tips answers questions posed online to the NEET website.
Can a beneficiary of a trust also be a Trustee?
Yes, trust beneficiaries are often also a Trustee of the trust. However, it takes careful drafting to avoid various tax traps that can inadvertently include the trust assets in the taxable estate of a trustee, among other potential problems. Selecting beneficiaries and trustees requires balancing many factors, including tax ramifications, the suitability of a particular person to take on the trustee’s responsibilities, and asset protection, among other considerations.
See the article: Choosing a Successor Trustee
Friday, September 25, 2009 Press Coverage of Estate Planning This Week (September 25, 2009)Jamie Downey of the Boston Globe provides a checklist of 16 items to complete for an orderly closing of one’s estate, including incapacity planning documents, wills and trusts, naming an executor and trustee, and completing a power of attorney for finances. See Organize Your Estate in 16 Steps (Sept. 24, 2009).
Bob Carlson of KCI Investing notes a few common estate planning mistakes to avoid, including overlooking non-probate assets, failing to fund a living trust, and not completing a financial power of attorney. He also points out the importance of designating guardians, keeping a record of important financial accounts, and providing instructions to your executor or trustee. See Avoiding Estate Planning Mistakes (Sept. 22, 2009).
Dennis Fordham, Esq., writes in the Lake County News (Lakeport, Calif.) about discretionary spendthrift trusts, also known as beneficiary trusts, and the advantages for your children in receiving an inheritance in trust, rather than outright. See Estate Planning: Protecting Your Beneficiaries’ Inheritances (Sept. 19, 2009).
Clare Schwemlein of the Chillicothe Gazette (Chillicothe, Oh.) discusses using college savings plans, known as 529 Plans, as part of your estate plan. By making a five-year contribution up front, you can get assets out of your taxable estate quickly. See Education Savings As An Estate-Planning Strategy (Sept. 20, 2009). Tuesday, September 15, 2009 Estate Planning Tip of the WeekCan a Beneficiary also be a Trustee of a Trust?
A beneficiary may be a trustee of a trust, but depending on what the trust is intended to accomplish, you need to be very careful in deciding who the trustee should be.
Beneficiaries also fulfill the role of trustee in two common situations. First, where the creator of a revocable living trust, also known as the settlor or grantor, is a beneficiary and also trustee of their revocable living trust until they die. Second, if the deceased settlor drafted the trust to create beneficiary-controlled subtrusts upon the settlor’s death, the subtrusts will likely name the beneficiary as trustee for many purposes, but not others, such as distributing funds from the subtrust.
Naming a beneficiary as trustee has many implications that will impact federal and Vermont estate taxes, the degree of asset protection available, and, depending on the potential trustee’s abilities, whether the purposes of the trust are carried out. Also, be aware that a person cannot be the sole trustee and sole beneficiary, but may be the only current trustee and beneficiary provided successor trustees and beneficiaries are named.
Who is named as trustee of the trust is a central question the trust settlor should not take lightly. For more information on naming a trustee, see Choosing a Successor Trustee on the Articles Page. | |
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Welcome to NorthEast Estates and Trusts, PLLC (NEET). NEET assists clients with Estate Planning, Probate and Estate Administration, Special Needs Planning and Advanced Estate Planning matters in Shelburne, Vermont as well as Charlotte, South Burlington, Burlington), Hinesburg, Essex, Essex Junction, Colchester, Winooski , Cambridge, Huntington, Richmond, Williston, Jericho , Underhill , Underhill Center and Fairfax. NEET also serves clients in Chittenden County, Addison County, Washington County, Lamoille County, Franklin County and Grand Isle County.
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