Keep trusts updated as financial outlook, taxes change

People in Ohio who have used trusts as part of their estate planning may want to review those documents. There have been a number of changes in federal tax laws in the past several years that might make those trusts unnecessary or necessitate a change in them. One big change is in how trusts are taxed. For 2016, a trust with an adjusted gross income above $12,300 will be taxed at the highest marginal rate. As a result, it may be more cost effective to have either the beneficiary or the grantor pay the tax on income since the AGI threshold is significantly higher for individuals and married couples filing joint returns.

Another consideration is changes in the federal estate tax exemption. It has been rising annually, and if a person originally set up a trust to avoid estate tax, it may need to be altered, or it may be unnecessary. The worth of investments may fluctuate as well. What was once seen as a safe investment may no longer be.

By their very nature, trusts are usually long term, but this also means they require regular updating. Courts and state legislatures recognize this as well, and they are making it easier to make changes to irrevocable trusts and fix language that prevents the trust from doing what it is intended to do.

Whether individuals are creating a new estate plan or revising an old one, they may want legal advice as they proceed. A person might want to create a trust in order to avoid probate. A lawyer might also be able to assist in drawing up documents that protect people and their assets in the event that they become incapacitated. Under a power of attorney, a trusted individual can be appointed to take care of the principal's financial affairs in such a situation, while a living will specifies what kind of end-of-life care the person wants.

No Comments

Leave a comment
Comment Information

Office Location

Independence Office
6100 Oaktree Blvd.
Suite #200 - Park Centre 1
Independence, OH 44131

Toll Free: 888-236-5173
Phone: 216-765-0123
Fax: 216-595-2787
Map & Directions

Mayfield Heights Office
6105 Parkland Boulevard, Suite 140
Mayfield Heights, OH 44124

Toll Free: 888-236-5173
Phone: 216-765-0123
Fax: 216-595-2787
Mayfield Heights Law Office Map

Westlake Office
159 Crocker Park Boulevard
4th Floor
Westlake, OH 44145

Toll Free: 888-236-5173
Phone: 216-765-0123
Fax: 216-595-2787
Map & Directions

2005 BBB Torch Award Recipient Recipients of the 2005 BBB Torch Award Honoring Business of Integrity

  • Charter Member Elder care matters Alliance
  • National Academy of Elder law attorneys Inc. Member
  • ASNP
  • Cleveland Metropolitan Bar Association | CMBA Green Certified 2015-17
  • Listed On Elder case Websites