Why Create a Will?
Most people understand that a Will is a critical Estate Planning document that directs distribution of property upon death. But a Will can accomplish far more than property distribution. Did you know that a Will can also address:
- Differences between your wishes and state intestacy laws
- Naming a guardian for minor children
- Creating a trust and naming a trustee to handle the estate on behalf of minor children or grandchildren
- Establishing a Supplemental Needs Trusts for your spouse, disabled children or loved ones
- Ensuring continuity of government benefits to surviving spouses, partners or children
- Preserving assets while continuing Medicaid or other Long-Term Care benefits
- Avoiding unnecessary taxes and State liens
From the minute you become a client, we are 100% devoted to helping you plan for the future as you have envisioned it. It is more than a Will – it is a way forward.
Who Benefits Most from a Trust?
There are many different types of trusts, but the ones you will most often see associated with Estate Planning are Revocable Living Trusts and Special or Supplemental Needs Trusts.
Revocable Living Trust
Revocable Living Trusts are often recommended by financial planners who serve clients throughout the country as a means to avoid Probate. In Washington State, a Revocable Living Trust may occasionally be helpful in Washington, but not very often due to Washington’s strict asset protection rules. Nonetheless, a Revocable Living Trust can be beneficial in certain circumstances.
- Arranges for management and distribution of property
- Can be revoked, canceled or changed during your lifetime
- Assets are transferred to a trustee and administered according to detailed instructions
- Can help avoid guardianship proceedings
- Does not provide any protections from creditors to grantor (you or person establishing the trust), but does afford some protections from creditors to beneficiaries of the trust
- If properly funded, may avoid probate procedures
- Can save ancillary costs and probate fees if you own real estate outside of your resident state and properly transfer those assets to the trust
- Downside: in Washington the only way spouses can protect assets from Long-Term Care expenses for the benefit of the surviving spouse is through a Will that contains a testamentary Asset Protection Trust
NOTE: If you or your spouse has a Revocable Living Trust, and if you are residents of Washington State, you are not taking advantage of the most useful asset protection tool available.
Special or Supplemental Needs Trust – Asset Protection!
For the most part, the terms “Special” Needs Trust and “Supplemental” Needs Trust are interchangeable and refer to “discretionary” trusts. A Special Needs Trust typically refers to a Trust established for the benefit of an individual or a child who is disabled and who is receiving government needs-based benefits. Supplemental Needs Trusts are often used for those persons who may need government benefits in the future, or who may need asset protection.
The Trust is referred to as an “Asset Protection Trust”. When used in a Will to protect assets for a surviving spouse or family member against Long-Term Care costs, State liens, Taxes, Creditors and to prevent future “unintentional disinheritance”. If you have a loved one with special needs or you simply wish to ensure that your loved one will be taken care of when you are no longer able, we may recommend a Trust that:
- Allows disabled persons who are currently receiving or expect to receive government benefits to preserve those benefits, while also providing for additional funds for the benefit of the Trust beneficiary
- May be set up as a Living Trust (intervivos) or a Testamentary Trust (through one’s Will)
- Allows parents of a disabled child or other family members to contribute additional funds to supplement government benefits
- Permits persons who have been severely injured and receive a personal injury settlement or award to preserve those funds and remain eligible for government benefits
- Protects funds for a surviving spouse facing Long-Term Care needs without interfering with Medicaid Long-Term Care eligibility requirements
If you or your loved ones are in need of a Wills and Trust Attorney in Washington, Contact Elder Law Group for more information.