It’s important to first know what the assets of the estate are, and what claims are being made against those assets. Is the estate solvent? If not, Minnesota law sets out a priority list for paying creditors. The creditors at the bottom of the priority list may not receive anything. » Read more..
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The upfront costs of creating a Revocable Living Trust is almost certain to be higher than creating a Will, but a Revocable Living Trust may be cheaper in the end. Why? The Revocable Living Trust typically avoids the time and expense of probate. » Read more..
You don’t need to be a millionaire to benefit from a Revocable Living Trust. Regardless of your wealth, a Revocable Living Trust should be considered when you:
Want the opportunity to avoid probate. Probate is required in Minnesota if you own $50,000 or more in assets in your name alone at your death, or you own real estate in your name alone. Any assets held in the name of your Revocable Living Trust are not counted toward the $50,000 figure that triggers a probate action. Probate costs money and takes time. » Read more..
Revocable Living Trusts are an excellent estate planning tool, but there are common misconceptions about them. A Revocable Living Trust is set up by you, during your lifetime. » Read more..
Most of the time, Minnesotans are probably looking at six months to a year or more for a probate action to be completed.
There are various forms of probate in Minnesota. Probate proceedings may be formal or informal. Formal proceedings may be supervised or unsupervised. Formal proceedings are used, for example, when some of the beneficiaries are minors, the heirs are fighting, or the original Will is missing or not executed properly. Insolvent estates are routinely administered “formal, supervised” because the Probate Court needs to supervise the priority given to certain debts under Minnesota law. » Read more..
One of the many advantages of establishing a revocable trust is the so-called “spendthrift provision” that operates to keep creditors at bay from the trust’s beneficiaries. It doesn’t matter if the beneficiary is a “spendthrift” or is the model of good financial management – all beneficiaries are protected. The only exception is that the trust creator can’t escape creditors by putting property into a trust for his or her own benefit. » Read more..
Persons writing Wills in Minnesota select a “personal representative” (known as “executor” in some states) to settle their estates after they die. The personal representative manages and distributes the deceased’s assets, per the Will instructions, after first paying the deceased’s creditors, the costs of administering the estate, and any estate taxes owed. In Minnesota, the personal representative has the power to sell real estate, liquidate assets, and determine which bills should be paid and which should be denied. » Read more..
“Trust fund baby” implies someone born into a wealthy family, but even families with less than $1 million in assets can benefit from a revocable trust.
A key benefit of trust is to control the ages at which children receive their inheritance when both parents die. Without a trust, sons and daughters as young as 18 years of age receive full distribution of their inheritance in Minnesota. Alternatively, a trust allows parents to preselect the ages that their children must reach before receiving any trust assets, and not all of the trust assets need to be distributed at once. For example, parents could let a child inherit one-third (1/3) of their trust inheritance at age 30, half of the remainder at age 35 and the rest at age 40. That way, the children aren’t in danger of losing everything should they make foolish mistakes with their initial distribution from the trust. » Read more..