Trusts

A trust is a legal document that enables an individual to transfer ownership of assets to a trust and provides the "trustee" with instruction for the management and distribution of those assets in the event of incapacity or death. When a trust is properly prepared and funded (ownership of the assets have been transferred to the trust), it can help you accomplish a variety of objectives. A trust is a useful tool to: (1) provide for the needs of your spouse, children and grandchildren in the event of death or incapacity; (2) distribute (or retain) personal property and assets to/for the beneficiaries based on an individual's circumstances; (3) help minimize estate and inheritance taxes; (4) provide for charities, churches and non-profit organizations; and (5) provide multi-generational support. Some of the more common types of trusts are:

• Revocable Trust (Living Trust) – Can be changed or canceled during your lifetime. A revocable trust allows you to transfer assets into your trust but still allows you to manage them. The trust's earnings are consolidated into your income tax returns.
• Irrevocable Trust – Separate legal entity and its own taxpayer. An irrevocable trust is part of an estate plan and usually funded to reduce the size of the taxable estate. Once an irrevocable trust has been funded it can not be amended or revoked.
• Irrevocable Life Insurance Trusts (ILIT) – Holds your life insurance policy and pays the premiums. Upon your death, the trust collects the proceeds, which are excluded from the taxable estate.
• Charitable Trusts – Sets up during your lifetime where (1) you can receive an income stream for life and the charity receives the assets at death (Charitable Remainder Trust) or (2) where the trust pays a fixed percentage of assets to a qualified charity for either a set number of years or for the life of the individuals and the family receives assets at death (Charitable Lead Trust).
• Special Needs Trusts – Generally set up by the parents or relatives of a disabled person to pay the medical and living expenses of the disabled person during their lifetime.

Trust Administration

When considering who to name as your Trustee or Co-Trustee, you should keep in mind that friends and relatives may not possess the level of investment management skills and/or expertise in fiduciary law and practice that many trusts require. The Trustee or Co-Trustee named will also have to make unbiased decisions in carrying out your instructions that might cause hard feelings with your family and the beneficiaries. When you appoint River Place Trust as your Trustee or Co-Trustee, you have peace of mind knowing that we have: the experience, expertise and knowledge to handle the financial affairs you designate, make the tough decisions necessary to carry out your instructions and to oversee your assets and investments to effectively, and prudently, administer your trust.

Our role as Trustee or Co-Trustee, among other duties, would be to:

• Review the trust and related estate planning documents
• Communicate our roles, responsibilities, and your wishes to the beneficiaries of your trust
• Identify, inventory, and collect the trust assets including real estate, investments, jewelry, automobiles, and bank accounts
• Determine if there are assets to be probated
• Determine the amount of cash required for payment of debts, taxes, and expenses
• Analyze and review investment and tax planning strategies
• Coordinate with accounting firms for the preparation of all required tax returns
• Arrange for the distribution of assets to the beneficiaries