Silver Springs, MD Trusts Lawyer
At some point or another, people have probably heard the word “trust” or “trust fund” used in a financial or legal context. Trusts are agreements where somebody sets something to benefit another party. Since that definition is very broad, trusts can serve many different purposes. They can be used to get around inheritance issues, get tax breaks, and more. Because trusts have so many different uses, lots of people are interested in setting up trusts for one reason or another.
If you are considering creating a trust, let our lawyers help you with it. We know how trusts operate in Maryland, and we will make sure that the trust operates the way you want it to and that you pick the right kind of trust for your situation.
If you need help or have concerns, call Rice, Murtha & Psorsas’s trust attorneys at (410) 694-7291.
What are Trusts in MD?
Trusts are legal arrangements where a “grantor” sets up a “trust,” run by a “trustee,” to benefit a “beneficiary.” The grantor is simply the person who sets up the trust. They create the document with the help of our trust lawyers and decide what the purpose of the trust is. The trustee is the person in charge of administering the trust. They carry out the grantor’s wishes and ensure that everything runs smoothly. The beneficiary – or beneficiaries – are the people that they trust and are meant to help out.
Trusts do not need to benefit individuals. They can help groups of people, businesses, organizations, and more. The possibilities are endless, so you should discuss what you want to do with our lawyers.
Types of Trusts in Silver Springs, MD
There are two main types of trusts in Maryland – revocable and irrevocable trusts. Both have different advantages and disadvantages, making them better for certain goals or situations.
Revocable trusts, as the name would suggest, can be revoked by the person who created them. The grantor has a lot of power in revocable trusts. They can add or remove beneficiaries, change the terms of the trust, or end the trust altogether. This kind of trust is ideal for individuals who want a lot of control over what happens to the assets in their trust or may change their mind about what assets are in trust. However, revocable trusts require a more active role on the part of the grantor.
Irrevocable trusts, on the other hand, cannot be changed or done away with easily like a revocable trust. A grantor who sets up an irrevocable trust cannot change its terms or change who the beneficiaries are. However, with that rigidity comes stability and assuredness. Irrevocable trusts are often used for estate planning or for tax benefits because assets in irrevocable trusts do not need to have income tax or estate taxes paid on them.
What Can Trusts Be Used for in Silver Springs, MD?
In Maryland, trust can be used for any legal purpose. This gives grantors a lot of options when they are talking to our trust’s lawyers. Some of the things you can set up a trust for include:
Talking Care of Your Children
Many people set up trust funds to benefit their children, grandchildren, or other relatives. Sometimes, the income generated by these trusts is put towards a specific purpose outlined in the trust documents. For example, a grantor could set up a trust to start generating income “to pay for my children’s college tuition.” The stated goal of that trust would prevent the funds it generates from being used for other purposes.
Other times, things may not be so clear-cut, and the beneficiaries will be able to use the money for whatever they choose. Depending on what you want to do, it may be a good idea to include a provision in a trust set up to benefit children that states they cannot access the funds until they reach a certain age. That way, you can ensure that it is not all spent immediately. You can work with our lawyers to figure out the exact terms of this kind of trust that will work best for you.
Tax Benefits
Many people set up trusts because they have tax benefits. Placing assets in a trust can reduce or eliminate some of the tax you have to pay on those assets. The primary benefit is that assets the grantor places in trust up to certain amounts are not subject to a “gift tax.” Other benefits may differ depending on how you structure the trust, so you should discuss with our attorneys to ensure that it is set up correctly for the benefits you want.
Charitable Trusts
You can set up a trust to benefit groups and other entities instead of just people. For example, if there is a particular charity or philanthropic endeavor you are fond of, you can set up a trust for their benefit so that you can get part of that benefit, too.
Gun Trusts
Many people place firearms in revocable trusts to make it easier to transfer them to relatives. This is particularly true of highly regulated items like machine guns, short-barreled rifles, and other things that can be very difficult to transfer between parties. For example, if you have an NFA item that only you can use and possess, it can land anyone who inherits it in hot water when it transfers to them upon your passing. If the NFA item is in trust, then every trustee possesses the firearm and there is no worry about running afoul of firearms transfer laws.
Talk with Our Silver Springs, MD Trusts Lawyers Today
Our trusts attorneys are here to help and can be reached by contacting Rice, Murtha & Psoras at (410) 694-7291.