There are many issues to consider when estate planning. This is especially true to those who have a significant number of assets. For these individuals, merely identifying and valuing all those assets can be a headache. Of course, not everyone has vast amounts of wealth to leave to loved ones, but even those of modest means can benefit from estate planning.
Just look at most people’s most valued asset: the familial home. Determining how to leave a residence to an heir can be challenging and costly. This is why it may be beneficial to consider either purchasing the residence in trust or later placing the home in a trust. By utilizing a revocable trust, a homeowner can continue to benefit from use of the home and place conditions on how named beneficiaries can use the residence once it is passed on to them. Since this type of trust is revocable, named beneficiaries can be changed at any time.
A home can also be placed in an irrevocable trust. Doing so reduces the taxable value of an estate, which may save an estate money in the long-run. Again, parameters can be placed on the trust to ensure that it is passed down in accordance with the trust creator’s wishes. Those considering this option need to be careful, though, because, as its name implies, once created an irrevocable trust cannot be modified.
To be effective, an estate plan must be thorough and well-thought out. Individuals who don’t meticulously address the details of their estates can wind up having assets pass to unwanted recipients, subjected to avoidable taxes, and/or inherited without desired restrictions. This is why Arizona residents should think about discussing these matters with an estate planning attorney they trust, especially when it comes to determining what to do with a family home.