• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
logo

The Edwards Law Firm

Estate Planning For All Generations

  • phone-icon (904) 215-3550
  • phone icon (904) 672-7600
  • Schedule a Free Consultation
  • Home
  • Who We Are
    • About Our Firm
    • Attorney and Staff Profiles
  • How We Can Help
    • Business Owners & Asset Protection
    • Estate and Gift Tax Figures
    • Family-Owned Businesses & Farms
    • Incapacity & Caregiver Support
    • LGBTQ Estate Planning
    • Medicaid & Elder Law Planning
    • Pet Planning
    • SECURE Act
    • Special Needs Planning
    • Probate & Trust Administration
    • Wills & Trusts
  • Elder Law
    • Are You A Caregiver?
    • Coping With Alzheimer’s
    • Emergency Medicaid & Nursing Home Planning
    • Guardianship & Conservatorship
    • Hospice Care
    • Medicaid Planning
    • Veteran’s Benefits
  • Resources
    • Estate Planning Resources
      • Estate Planning Checkup
      • Definitions
      • Reports
      • Incapacity Planning Definitions
      • Is Your Estate Plan Outdated?
      • Top 10 Estate Planning Techniques
    • Elder Law Reports
    • Frequently Asked Questions
      • LGBTQ Estate Planning Frequently Asked Questions
      • Incapacity Planning Frequently Asked Questions
      • Frequently Asked Estate Planning Questions
      • Trust Administration & Probate Frequently Asked Questions
    • Pre-Consultation Form
    • Special Needs Resources
    • Trust Administration
      • Bereavement Resources
      • How to Know if You Need Extra Help With Your Grieving
      • The Mourner’s Bill of Rights
      • Trust Administration & Probate Definitions
  • EVENTS
  • BLOG
  • Reviews
    • Review Us
  • Contact Us

Incentive Trusts May Be The Answer

November 26, 2010 by William T. (Tom) Edwards, Jr., Attorney & Counselor at Law

Leaving someone an inheritance is not as simple as adding some zeros to his or her bank account balance. It can be…but this is not always in the best interests of your loved ones. It’s likely that some of your heirs are mature and established with a history of being able to handle their own affairs appropriately, and you may have no concerns about them. But you may also have some younger heirs who have not yet made their marks in life, or some family members who have personal problems or a history of handling money unwisely. This can make you take pause when you are engaged in the process of inheritance planning.

An estate planning vehicle that many people who are having these types of concerns choose to utilize is the incentive trust. These trusts operate like any other, where you name a beneficiary to receive distributions out of the trust and a trustee to handle the funds. But the difference lies in the fact that you include stipulations in the trust agreement that must be met before distributions will be made in an effort to guide your heir toward positive choices.

One example of how an incentive trust might be used would be to encourage your heir to get a good education. You could stipulate that distributions from the trust will be made as long as this individual is a student in good standing at an accredited college or university. One may choose to offer additional lump sum contributions each time your heir obtains a degree.

You can place any stipulations you want to on the distributions, and many people will use these trusts to discourage self destructive behavior in their family members. You may require drug testing of an heir who has a history of abuse, or open up ongoing distributions only after your heir quits smoking.

Incentive trusts are not the right choice for every situation because many people would prefer not to be forced to do things they may or may not want to do in order to receive their inheritances. But, these trusts are something that is available to you and they may provide you with the solution you are seeking for a particular heir or heirs.

  • Author
  • Recent Posts
William T. (Tom) Edwards, Jr., Attorney & Counselor at Law
Latest posts by William T. (Tom) Edwards, Jr., Attorney & Counselor at Law (see all)
  • Top Estate Planning Tips for 2016 - April 29, 2016
  • Free Report: Florida Estate Planning for Newlyweds After 50 and The Blended Family - August 10, 2015
  • Latest Updates for Florida’s Medicaid Program - July 13, 2015

Primary Sidebar

FOLLOW US ONLINE

Footer

The Edward Law Firm

Jacksonville
3030 Hartley Road, Suite 210
Jacksonville, FL 32257
Phone: (904) 215-3550
Secondary phone: (904) 672-7600

ST. AUGUSTINE (By Appointment Only)

1750 Tree Boulevard, Suite 9
St. Augustine, FL 32084
Phone: (904) 824-1750

Map/Location

Map

Office Hours

Monday  8:30 AM – 5:00 PM

Tuesday  8:30 AM – 5:00 PM

Wednesday  8:30 AM – 5:00 PM

Thursday  8:30 AM – 5:00 PM

Friday  By Appointment Only

The information on this website is for general information purposes only. Nothing on this or associated
pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. This
information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

  • Privacy Policy
  • | Disclaimer
  • | Site Map
  • |
  • Powered by American Academy of Estate Planning Attorneys
© 2022 The Edwards Law Firm. All Rights Reserved.