3 Types of Specialized Trusts You May Need

 Posted on December 27, 2024 in Estate Planning

Most well-designed estate plans include at least one trust. A revocable living trust is usually used when the purpose is simply to distribute estate assets after the trustor’s death. Some plans include an irrevocable trust for asset protection purposes during the trustor’s life. There are many other types of trusts that serve more specialized purposes. You may want to include a smaller trust with a specialized purpose in your estate plan depending on who you want to leave property to and for what purpose. An experienced Lake County, IL estate planning attorney can help you decide if you need one of these special types of trusts.

Pet Trusts for Protecting Your Furry Companion

A pet trust is designed to provide financial support for your pet for as long as it lives. If you have a cat, dog, or other animal that you want to make sure is well provided for should the pet outlive you, you may consider using a pet trust. First, you would use your testamentary instrument to designate the person who should take your pet. You can then instruct your trustee to distribute funds to your pet's new caretaker to meet the pet's needs. Pet trust funds can be used to pay for your pet’s food, medical care, toys, and other necessities.

Special Needs Trusts That Will Not Endanger Your Loved One’s Benefits 

If you want to leave money to a person who has disabilities and is reliant on Supplemental Security Income, you may need a special needs trust. Giving a large sum of money - even just a few thousand dollars - directly to an SSI recipient can push him or her over the income limit and cause the person to lose access to SSI and other government benefits. A special needs trust allows you to make controlled distributions from the trust in a way that will not count against your loved one’s benefits. Your loved one can use the trust to make reasonable expenditures for things like clothing, household goods, and entertainment.

Charitable Trusts 

If you want to leave money to a charitable organization, a charitable trust may be an excellent tool for you. You can choose one or more charitable organizations to be the beneficiary. Using this type of trust also offers significant tax breaks for you. Using one can also be a great way to leave a legacy.

Contact a Libertyville, IL Trust Attorney

Newland & Newland, LLP can help you choose the types of trusts that you need. Our dedicated Lake County, IL estate planning attorneys have many decades of collective experience. Contact us at 847-549-0000 for a complimentary consultation.