A trust might be one way for Ohio residents to pass assets to beneficiaries after their death. One advantage of a trust is that it can provide a flexible way for a person to control how that is done. For example, if a person felt that an heir was too irresponsible to handle a lump sum inheritance, a trust could be used to pay a certain amount each month.
Trusts can be revocable or irrevocable. The difference in the two is that a revocable trust can be changed by the person who sets it up, but an irrevocable trust cannot be. However, the irrevocable trust offers a number of advantages over the revocable trust. Since the funds are no longer considered to belong to the settlor, they are not accessible by creditors. They also are not counted toward the total value of the estate for estate tax, and they may allow settlors to qualify for certain benefits, such as Medicare, without paying down their assets.
Irrevocable trusts may be created and funded while a person is still alive or after the person’s death. The terms for the latter type, a testamentary trust, are placed in a will, and because the trust is not created until the person’s death, the grantor can make changes.
A person who is working on an estate plan might want to do so with the assistance of an attorney. Estate planning can be complex, and a person might be unaware of the many options that are available including how powerful and flexible some types of trusts can be. Furthermore, an attorney might be able to assist in preparing documents regarding finances and medical care in the event the person becomes incapacitated.