Trusts are tried and tested forms of asset protection and probate avoidance for many couples and families. Trusts may remove many burdens of estate administration. They may help high net worth families avoid estate taxes. They keep families in control of their assets and keep the government’s long arm out of reach, in many cases.
Our estate planning practices changed materially in the last half of the 20th century.
Our clients got divorced or had bad life experiences in which their kids got on drugs, dropped out of school, and were no longer the apples of their parent’s eye anymore. Our instructions became:
“Don’t leave anything outright to my daughter – I don’t trust her husband. I don’t want him to divorce her and take what I’m leaving to her.”
“Don’t leave anything outright to my son, he’s in jail,” or “He would spend it and not have it in six months, or he would give it to his friends.”
“How can I protect my daughter and her husband who already have gone through $50,000 in credit card debt and have or are likely to have judgments against them.”
“My kids have tons of student debt. Can what I leave them be taken to pay those debts?”
Nowadays, many of our clients often won’t let us leave property outright to their children and grandchildren. The only solution that makes sense is typically to leave property to them through a trust.
Understanding how a trust will work is an important part of the process of selecting and creating trusts such as a:
Revocable trust (living trust) – In this type of trust, you’ll have control over the terms of your trust while you’re still living and a full ability to alter those terms as you see fit.
Testamentary trust – This type of trust lets you enlist professional management of the terms of your trust by a grantee on behalf of your beneficiary.
Charitable lead trust – For a certain amount of time, this type of trust will donate payments determined ahead of time to charity before the beneficiary receives the remaining balance. This helps reduce inheritance tax liability for the beneficiary.
Generation-skipping trust – These trusts work exactly how they sound: The assets are passed along to the grandchildren of the grantor rather than the next immediate generation.
Special needs trust – The disabled recipients of this trust are able to simultaneously receive government benefits and asset payouts from the grantor. It essentially gives protection and security to your loved ones with disabilities.
Remainder trust – These work similarly, but opposite, to charitable lead trusts, in that the beneficiary receives a set amount for a pre-determined timeline, then the rest is given to charity. This type of trust also reduces tax liability.
Domestic trust – These types of trusts allow people to give their assets to a spouse, regardless of whether that spouse is a citizen of the U.S.
Foreign trust – Although foreign trusts are set up in a foreign country and subject to local regulations, the U.S. still taxes this type of trust.
Clients of James H. Hard, Jr., Attorney at Law, in Houston, enjoy reassurance of accurate, customized information about appropriate trusts that will meet their needs. Lawyer James H. Hard, Jr. has been practicing law in Texas for more than 50 years and has operated this firm for more than 40 years. His in-depth knowledge of trusts and other estate planning tools has been of great value to multiple generations of estate planning clients.
Most estate planning lawyers today are either generalists (practicing in many areas of law) or employed by large law firms where the quantity of clients is vital. Clients of James H. Hard, Jr., Attorney at Law, on the other hand, often say they choose to work with Mr. Hard because of the personal touch he provides. As a sole practitioner, he works only for clients. One-on-one attorney-client relationships are fundamental at this law firm. In this environment, clients appreciate the opportunity to learn about and collaborate on the trusts they are looking for to protect assets and avoid probate.