Trusts Offer More Than Estate Tax Protection

Find out whether a testamentary trust, living trust, or special-purpose trust can benefit your family

This week, Craig Siminski, of Equity Design Group, shares with us some of the often overlooked benefits of a trust.

The 2017 tax reform law effectively doubled the federal estate tax exclusion amount to $11.18 million for individuals who died in 2018 ($11.4 million in 2019). With the portability provision that allows the unused exclusion amount to pass to a surviving spouse, a married couple could shelter up to $22.8 million in 2019.

Trusts have often been used to help avoid estate taxes, but at these exclusion levels it’s unlikely that many families need a trust for this purpose.

However, some states have estate taxes or inheritance taxes with lower exclusion amounts, and the federal amount is scheduled to revert to its pre-2018 level in 2026 unless Congress takes further action.

Even if the value of your estate seems modest, a properly constructed trust can offer many benefits, such as sparing your heirs the costly and time-consuming probate process, serving a variety of special purposes, and protecting your assets so they will be distributed according to your wishes.

Legal Control of Assets

A trust is a legal arrangement under which one person or institution controls property given by another person for the benefit of a third party. The person giving the property is referred to as thetrustor (or grantor), the person controlling the property is the trustee, and the person for whom the trust operates is the beneficiary. With some trusts, you can…

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Craig Siminski is a CERTIFIED FINANCIAL PLANNER™ professional, with more than 20 years of experience. His goal is to provide families, business owners, and their employees with assistance in building their financial freedom.

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