Chicago Trusts Lawyer

A Trust is typically a Will substitute. A Trust and a Will accomplish the same goal.  They both indicate who you want to receive your assets upon your death, and who will be in charge of the process.  The primary difference between the two documents is that for a Will to be effective, it often has to go through the probate process.  (For more on probate, please see the discussion under the Wills tab on this website.)  The primary function of probate is to pass title, i.e. ownership, of assets to those who you wish to benefit.  Probate is all about changing title to assets.  With a Trust, we can avoid the probate process by doing what probate is all about - changing title - now. For example, if ownership of a house passes to your children pursuant to a Will, the Will typically has to be probated for the transfer to become effective.  If ownership of the same house passes to your children under the terms of a properly funded Trust, the probate process can be avoided.

In addition to avoiding probate, a Trust can diminish or eliminate the estate tax.  The estate tax is a tax that the Internal Revenue Service puts on the transfer of ownership of assets when someone passes away.  Many people are not subject to estate tax but if your estate is, it can prove to be extremely costly.   Trusts are a way to deal with this potentially onerous tax.  A properly drafted and funded Trust can avoid probate and diminish or eliminate estate taxes.

There are several kinds of Trusts.  Some Trusts are revocable, which means that they can be changed or entirely eliminated.  Some Trusts are irrevocable, which means that once in place, they cannot be changed.  Some Trusts are referred to as testamentary, which means that their terms are set forth in a Will, and can often be established only after the Will has been probated.

Which type of Trust is best for you is one of the topics that will be considered at the initial consultation.