While a will is an essential estate planning tool, other documents can also help you protect your assets and look after your loved ones. A living trust provides benefits that a will can’t on its own. The following overview explains why more people are using living trusts to develop a more comprehensive estate plan.

What Are the Advantages of Using a Living Trust in Your Estate Plans?

1. Maintain Control of Finances with Flexibility

In estate planning, a will is used to determine what happens to your assets after you pass. Alternatively, a living trust gives you the authority to manage your wealth throughout your lifetime. Upon your death, that same document passes those assets on to the individuals you choose at the time you choose and in the amounts you choose as opposed to a will which distributes the assets immediately..

2. Protect Assets From the Probate Process

A will is a public document, which creditors can use to make claims against the estate. As a part of the probate process, the assets mentioned in the will are included in paying off creditors. However, a living trust is not a public document, so assets listed in it do not go through the probate process. Your estate planning attorney can help you set up the living trust to ensure certain assets are protected.

3. Minimize the Likelihood It’s Contested

If you only leave behind a will, your relatives may tie up the distribution of your assets by contesting the legitimacy of the will. While there are many reasons one can contest a will, a living trust can only be disputed in a couple of situations. Essentially, anyone contesting your living trust must be able to show that you were mentally unfit at the time the document was created, or they must show that you created the trust under force or duress.

4. Reduce Estate Taxes

Another significant advantage of using a living trust is that it reduces the estate taxes owed upon your death. Assets listed in the trust are not taxed, so this can reduce the overall amount owed by your estate. However, consult an attorney because there’s a limit to the amount you can gift to others tax-free. This amount changes year to year. In 2009, the limit was $13,000, but tax law revisions brought that amount up to $15,000 by 2019. For this reason, update your estate plans annually.

Estate planning is rarely simple, and the changing tax laws can further complicate the process, so consult an experienced attorney. Serving the southeast Columbus area, Zellar & Zellar Attorneys at Law, Inc., can help you create a comprehensive plan that will help you protect your assets and care for your family. To schedule a consultation, call (614) 257-1643. Visit them online to explore their services. This article is intended to provide general information and should not be construed as legal advice or in creating an attorney-client relationship.