That is one possible option. But with that choice, there could be a substantial tax bill. When you put your retirement in a trust it becomes taxable because of the change in ownership. We advise our clients to name the trust as the beneficiary of any type of retirement account they have.
Also, we recommend, if you are married, to name your spouse as the beneficiary and the trust as a contingent beneficiary. This allows for better, more lenient withdrawal requirements for the spouse.
What Is The Downside Of Naming My Trust As The Beneficiary Of My Retirement Plan?
If you are married and name the trust as the primary beneficiary there are different rules for mandatory distributions. For that reason, we recommend that you name your spouse as the primary beneficiary. There are specific distribution rules that have to be followed, but they are more lenient for a spouse than for a trust.
With A Recession Looming, Is There Any Way To Protect My Assets For My Beneficiaries?
The best way to protect assets, in any situation, is to place them in a trust, preferably an irrevocable trust. If the recession significantly affects you and you have to declare bankruptcy, your assets will be protected from the creditors.
Can I Protect The Value Of My Assets Held In A Trust During An Economic Recession?
Putting your assets in a trust will not protect them from potential downside risk. Regardless of your asset’s location or type, the value will rise and fall in line with the macro environment. However, putting your assets in a trust may offer a little more security.
What Are Digital Assets? Do Digital Assets Have Enough Value That They Should Be Protected With Estate Planning?
Digital assets are anything that exists only in digital form and has a distinct usage right. Some common examples of digital assets are cryptocurrencies like Bitcoin, copyrights, music, movies, or videos. If you have valuable digital assets, they should be placed in your trust so they are treated the same as other tangible assets like your house or car.
What Happens To Digital Assets When You Die If You Did Not Include Them In Your Estate Planning?
When you die, a digital asset is treated like any tangible asset. In South Carolina, they would go through intestate distribution and probate. The law would determine how that asset will be passed on to your heirs.
How Do I Preserve My Digital Assets And Ensure A Smooth Transition Following My Death Or Incapacity?
It is important to review the terms and duration of the copyrights of any music, videos, or movies you own. Keep a record of what you have copyrighted and make sure they are current and renew when necessary. These assets should be placed in a trust just like any tangible asset so that they can be passed on and handled by your successor trustee.
Can My Spouse And I Set Up A Joint Trust Together In South Carolina?
It is a very common practice to create a family or marital trust. When it is set up, you would put joint assets as well as individual assets into the trust. You and your spouse would be the co-trustees as long as you are alive. When one spouse dies, the other spouse would continue as the trustee.
What Happens To A Joint Revocable Trust When One Spouse Dies?
Most family trusts are revocable but when the first spouse dies, the trust becomes irrevocable. That means that the surviving spouse cannot make changes to the trust. In blended families, where each spouse has their children from a different relationship, these rules keep the surviving spouse from cutting out their deceased spouse’s children.
Can A Surviving Spouse Change A Revocable Trust?
No, he/she cannot. When the trust is set up, the terms are defined. With our clients, a trust will become irrevocable upon the death of the first spouse. That protects what the spouses decided on together and prevents future changes.
For more information on Putting Your Retirement Into A Trust In SC, a free initial consultation is your next best step. Get the information and legal answers you seek by calling (864) 271-7940 today.