When Florida residents consider estate planning, they often focus on wills and developing ways to preserve their assets. Many understand the importance of having a will, but they may not consider other ways of protecting an estate, such as establishing trusts for their assets while they are still alive.
For example, a qualified personal residence trust allows homeowners to remain in their residence while transferring the deed to a trust for their heirs. When the homeowner dies, taxes due will reflect the home's value at the time that the trust was created, not at the time of death which may occur many years or even decades later. This not only protects heirs from having to pay excessive taxes, it may allow the family to keep a home rather than having to sell it.
Another option is for people to begin placing their assets into irrevocable trusts for their heirs while they are still alive. This separates inheritances from the main estate, reducing its value so that the estate tax burden is not as high as it might otherwise be. Trusts can also be a good option for heirs who may not be able to handle the receipt of a lump sum inheritance under a will. The trust can be set up to make disbursements contingent upon the achievement of a certain age or other milestone.
Contrary to what some people believe, trusts are not just for the rich. In fact, the fact that these techniques can often save a great deal of money may make them very suitable for those with more modest incomes. Consulting with an experienced estate planning attorney may be a good first step for those who are interested in exploring these options.