Trusts

A trust is a fiduciary arrangement, often used in estate planning, which allows a third party, or trustee to hold assets on behalf of a beneficiary or beneficiaries and can determine how and when the assets pass to those beneficiaries. Trusts can sometimes avoid probate so that your beneficiaries may gain access to these assets more quickly than they might to assets under a will, saving time, court fees, and potentially reducing estate taxes as well.

Trusts can provide… Greater control – allowing you to determine exactly when and to whom distributions will or may be made. This can be helpful in complex situations where you may want to include or exclude certain potential beneficiaries. Protection of assets – helping to protect your estate from your heirs’ creditors or from beneficiaries who may not be adept at money management. Privacy and probate savings – allowing assets to pass outside of probate and remain private, in addition to possibly reducing the amount lost to court fees and taxes in the process.

Revocable vs. irrevocable

There are many types of trusts but a major distinction between them is whether they are revocable or irrevocable.

• Revocable trust: A revocable (living) trust can be changed or dissolved at any time, while you are living, helping assets to pass outside of probate. This allows you to keep control of the assets during your lifetime. A revocable trust typically becomes irrevocable upon your death.
• Irrevocable trust: An irrevocable trust cannot be changed once it is executed, typically transferring your assets out of your (the grantor’s) estate and potentially out of the reach of estate taxes and probate. If your primary aim is to reduce estate taxes, then an irrevocable trust may be preferred. It may also protect you against possible legal judgments.

From a charitable standpoint, there are two main types of trusts…

• Charitable lead trust
  Provides benefits to a charity up front, with the remainder going to your beneficiaries.
• Charitable remainder trust
  Provides you with an income stream for a defined period of time, with any remainder going to a charity.

Deciding on a trust

State trust laws differ greatly and should be understood before making any decisions about a trust. Choosing and creating a trust can be a complex process; the guidance of an attorney with estate planning expertise is highly recommended.

PSS cannot provide legal advice, but we would be happy to discuss your intent and make suggestions. Please contact our Development Department by calling (212) 874-6633 or emailing giving@pssusa.org.

Please tell us about your gift!

Some people include PSS as a beneficiary of a trust without telling us. But we would welcome the chance to say thank you. And, your gift can inspire others to make a similar gift to PSS to help future older New Yorkers.

To notify us of a legacy gift you have planned, or to discuss the best gift option for you, please contact our Development Department by calling (212) 874-6633 or emailing giving@pssusa.org.

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