Trust Planning and Flexibility

With the federal Estate and Gift Tax Unified Credit and the Generation Skipping Transfer Tax exemption now at $5,250,000 and indexed for inflation, and with the Rule Against Perpetuities running for 100 years or more or having been eliminated entirely in some states (not including Massachusetts), the possibility for large Trusts to last a very long time is much greater than ever before.  This Blog will discuss the importance of building flexibility into the Trust Agreement itself.

Selection of Trustee

A major issue that, surprisingly, is often given little thought in the planning process is selection of the Trustee.  The Trustee is the manager of the assets as well as the person who stands in your shoes to decide what distributions should be made to your beneficiaries.  This is a big job and is often daunting for the non-professional.

It is important to provide flexibility to be able to change or add Trustees as years go by.  Consideration should be given to the location of the beneficiaries as well as the Trustee.  The Trust document should provide a process to change the Trustee if either the beneficiary or the current Trustee move to different jurisdictions.  It should also allow for different Trustees to serve for different beneficiaries.Duck

My next blog post will continue on this topic.


About Janet Moore

Janet has been with the firm since 1980 and is a partner in the Trusts and Estates Group. She focuses her practice in estate planning and estate and trust administration, including all areas of estate and gift tax planning, ranging from testamentary estate planning (including wills, trusts, durable powers of attorney, health care proxies and living wills) to sophisticated lifetime gifting techniques, such as irrevocable life insurance trusts, lifetime marital (QTIP) trusts, spousal lifetime access trusts (SLATs), charitable trusts, grantor retained annuity trusts (GRATs), intentionally defective grantor trusts, family limited liability companies, and qualified personal residence trusts (QPRTs). Janet also advises clients in prenuptial agreements, elder law and planning for special needs, guardianships and probate law, homestead declarations, charitable giving techniques, business succession planning, and asset protection planning. She also handles estate settlement and administration and trust administration and prepares gift tax returns, as well as estate tax returns and fiduciary income tax returns for estates and trusts. Janet is compassionate and easy to talk with and to understand, which contributes to her ability to work well with and relate to individuals and families, young and old.
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