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Save Time & Money With Revocable Living Trusts

December 24, 2010 by William T. (Tom) Edwards, Jr., Attorney & Counselor at Law

Estate planning can be a delicate matter on the personal side, but once you have decided how you would like to distribute your assets you have another challenge. You have to find a way to get these resources into the hands of your loved ones after your death without losing anything in the process. This would seem on the surface to be a very simple matter, but in fact, it is much easier said than done in many cases.

The most draconian interloper would be the tax man who can enter the picture demanding an enormous percentage of your legacy. Unless new legislation is passed to alter the laws as they stand as of this writing, the top rate for the estate tax in 2013 is 55% and the exclusion is $1 million. So any portion of your estate that exceeds $1 million is subject to this extremely harsh federal levy.

If the value of your estate does not exceed the exclusion, the primary source of asset erosion that you are probably going to be faced with is the process of probate. When you pass away with a will as your vehicle of property transfer your estate must pass through probate. The surrogate or probate court will determine the validity of the will and supervise its administration. There are significant costs associated with this, including attorney fees, court costs, the executor’s fee, accounting fees, liquidation charges, and appraiser fees. This can all add up to as much as 6-7% of the value of your estate. Plus, probate can take anywhere from several months to several years to run its course depending on the complexity of the case.

You can save a lot of time and money by creating an revocable living trust to avoid probate. With these trusts you maintain complete control of your assets while you are living. But upon your death your appointed trustee administers the distribution of these assets to your heirs according to your wishes. Through the implementation of this strategy your loved ones receive their inheritances quickly, there is no red tape, and you have the power to determine the details of the distributions. Many people choose to stipulate that the principal shall remain untouched and only the earnings from the trust will be distributed to the beneficiaries to ensure the long-term viability of the trust as a source of ongoing income.

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William T. (Tom) Edwards, Jr., Attorney & Counselor at Law
William T. (Tom) Edwards, Jr., Attorney & Counselor at Law
Attorney at The Edwards Law Firm, P.A.
For over four decades, Tom has assisted individuals, businesses and organizations with their legal management and legal services needs.With a burgeoning practice primarily devoted to estate planning, asset protection and trust and probate administration, The Edwards Law Firm, with Tom at its helm, has evolved in the last decade to include such vital elder law issues as Medicaid planning, VA planning, guardianship and more.
William T. (Tom) Edwards, Jr., Attorney & Counselor at Law
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