The phrase sounds so dry, distant, and downright scary – who wants to think about dying? However, it’s unfortunate that so many people shy away from even the thought of it because planning your estate is really about caring for your loved ones, seeing they are provided for, and making sure that your hard-earned money and property are distributed according to your wishes. Below is some information regarding trusts and wills, and their importance when it comes to estate planning, but please contact me if you have any questions or if you are ready to begin planning for the inevitable future.
Why Do I Need a Will?
Many people who have neither inherited wealth or accumulated wealth depend heavily upon life insurance and employment-related death benefits to “create” an estate should death occur at a comparatively early age. But what leave it to the State to determine who receives your money?
If you are a parent, especially of a young child, executing a will affords you the opportunity to state your preferences regarding custody of a child when circumstances at death require guardianship. Young parents with little accumulated wealth frequently overlook this important function of a properly prepared will but, for them, the appointment of an appropriate guardian for their child may be its most important function.
What If I Die Without a Will?
No question gets asked more than what happens to your property if you don’t have a will. Maryland has what is called the Laws of Intestacy and it proclaims the order of succession when someone passes away without a will, taking into account factors such as if your children are minors or adults. As unfortunate as it is, too often have I seen assets left after a person’s death go to someone who the person who died would not have wanted to inherit it, but proper planning with a will can prevent this and other avoidable circumstances.
The Revocable Trust
Inter vivos is a trust created when the person who made the will (also knows as the testator) is alive, as compared to a testamentary trust, which is created in your Last Will and Testament and becomes established upon death. An inter vivos trust may be either revocable or irrevocable.
A trust is typically used as a substitute for a will, not because it affords any tax advantage (for Federal Estate Tax purposes), but because using it reduces some expenses related to estate administration or probate assets as assets in a trust are not part of the probate estate and this can have significant advantages under the right circumstances. However, you must keep in mind that a trust is an entity for tax purposes and they have some of the highest tax rates in Maryland.
What is a Gun Trust?
Very few people are aware of the restrictions in which firearms may be transferred upon death. No matter whether you own a gun, rifle, or other NFA firearm, a gun trust is your best way to do so.
A Gun Trust does not incur annual fees like a corporation or LLC. Additionally, the trust does not require fingerprints or a background check. However, the trustee must be a permitted by Maryland law to own a firearm and if the trustee becomes a prohibited person, the firearm will remain in the trust until a permitted person is appointed as successor trustee.
You can change the beneficiary and/or the trustee during your lifetime, as well as add or remove firearms to the trust at any time. Upon your death, the gun trust maintains possession and control over your guns and the trust terms provide instructions and guidance to your beneficiaries.
Should you become incapacitated, the trustee of your gun trust will take care of your firearms during your disability. The firearms remain in the gun trust until your disability is gone or you pass away.
In order to protect your firearms and your family members, please let us help you set up a gun trust as soon as possible!