A Credit Shelter Trust is utilized when a couple has a Taxable Estate or is expected to have a taxable estate by the time of their passing. It is also known as an AB Trust or Bypass Trust. You should make an estate plan based on your current circumstances, not hypothetical scenarios. However, a Credit Shelter Trust should at least be taken into consideration if your combined assets are close to or greater than $10,000,000. It is one of the powerful tool In the state of Georgia for estate planning is the Credit Shelter Trust, also known as a Bypass Trust or a Family Trust.
What Functions Do Credit Shelter Trusts Serve in Georgia?
1. Estate Tax Avoidance or Reduction
Let’s imagine that once a partner passes away, the couple’s inheritance is worth $12,000,000. Let’s additionally assume that each person is entitled to an exemption of $5,000,000. The Credit Shelter Trust and the Marital Trust are both established upon the partner’s passing. The surviving partner would place the $5,000,000 maximum exemption amount in a Credit Shelter Trust. The partner that passed with a remaining $7,000,000 worth of possessions would be put into a Marital Trust.
2. Asset Protection
The assets will be safeguarded by a carefully formed Credit Shelter Trust from creditors, Second Marriages, new stepchildren, and perhaps even the surviving spouse abusing the funds. If the surviving spouse develops a disability and is unable to manage their finances later in life, the Credit Shelter Trust can also offer asset management.
3. Control Over Inheritance
You may be able to dictate the terms of your beneficiaries inheritance through trusts. To ensure that a lifetime of labor is wisely spent and handed on to children, grandkids, and even great-grandchildren, lifetime trusts, making distributions as defined ages, intervals, or upon accomplishing life goals, are all possible options. Trusts can also include provisions for unforeseen circumstances, such as a beneficiary with special needs.
Get Help Today & Consult with an Estate Planning Attorney
In Georgia, a Credit Shelter Trust can be a powerful tool in estate planning, offering a strategic way to maximize exemptions, protect assets, and provide for the financial well-being of a surviving spouse. It is crucial to work closely with legal and financial professionals to tailor the trust to your specific circumstances and stay informed about any changes in tax laws. We will offer you the support and guidance you need at Hurban Law.
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