3 minute read
Legal
IS IT TIME TO UPDATE YOUR OLD TRUST? By Libby Banks, The Law Office of Libby Banks before the increase in the federal tax exemption. It is
Ireview many trusts, and some of them are quite don’t need this type of plan anymore. An update can old. After these old trusts were put in place, a lot simplify the estate plan for the surviving spouse. of things have changed. For example, the federal estate tax exemption increased substantially in 2012, a Some of the plans I review still have guardians listed new Arizona Trust Code was put in place in 2009, and – but the children are now in their thirties with their most recently a new law affects those inheriting IRAs. own children. The trustees or executors may also no Then, of course, the situation of the people who are longer be the best choice, or even still alive. included in the trust have often changed completely. unnecessarily complicated and most married couples When so much has changed, it’s clearly time to update The change in the Arizona Trust Code also gives us the trust. some easy ways to leave money in trust for our children. The advantage of the trust you leave for your When we do an update, we usually do a complete children is protection of the trust money and assets in and when she dies, to her children. With a trust, you amendment – called a restatement – of the trust. We the event of divorce, and asset protection from credi- can make sure it goes where you want it to – you can keep the original trust name and date, and just note tors. even benefit your daughter’s husband during his life that it was restated as of the date we sign the new if you daughter dies first, but be sure that ultimately documents. That way, anything already titled to or Leaving your children their inheritance in trust may your grandchildren receive the inheritance when their transferred to the trust is still in the trust – we have no protect the inheritance at their death as well. Let’s say parents are both gone. need to change the title on homes or bank accounts your daughter inherits from you and puts everything again. in joint accounts. On her death, her husband will If your estate plan is more than a few years old, or you receive all of the inheritance because it is now joint don’t have a plan, please contact us for our no charge Older trusts for a couple may require the surviving property. And then, what if he remarries and doesn’t consultation offered by videoconference or phone. spouse to split the trust into two trusts on the death of put a plan in place for those assets to go to your Call us at 602-375-6752 or visit our website at Libthe first spouse. This was standard estate tax planning grandchildren? The assets may go to the new wife, byBanks.com.
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