Personal Property In A Trust In Franklin
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Rich people frequently place their homes and other financial assets in trusts to reduce taxes and give their wealth to their beneficiaries. They may also do this to protect their property from divorce proceedings and frivolous lawsuits.
Trusts also can be very useful for asset protection purposes if the creditors of the beneficiary are prevented from reaching the trust's assets. A trust can be an effective way to place assets outside the reach of creditors.
Grantors opting for these trusts lose their ownership rights to the assets within them. They lose the ability to decide how to manage or sell these assets.
In most situations, one would typically want to maintain full control of personal property assets. As a result, few would use this type of trust planning for personal property. An exception might be an heirloom of great value that spends most of its time in a safe deposit box.
Often, a Trust will be created along with a Will, which stipulates how holdings of the Trustor are to be distributed. Trusts can cover assets like real estate, but there may be other valuables that need to be transferred too. These valuables are known as Personal Property.
Trusts offer amazing benefits, but they also come with potential downsides like loss of control, limited access to assets, costs, and recordkeeping difficulties.
The chief advantage is to avoid probate. Placing your important assets in a trust can offer you the peace of mind of knowing assets will be passed on to the beneficiaries you designate, under the conditions you choose and without first undergoing a drawn-out legal process.
Trusts also can be very useful for asset protection purposes if the creditors of the beneficiary are prevented from reaching the trust's assets. A trust can be an effective way to place assets outside the reach of creditors. However, not all forms of a trust will function as an asset protection device.
When you buy a home, you may have the option of buying it in a trust. Legally, that means the trust, rather than you, owns the home. However, you can be the trustee of the property and have significant control over it and what happens to it after you die.
