Creating a living trust can be a great way to be proactive with your estate planning, giving you the means to protect your assets and make life easy for your family after you’ve died. But the rules governing the creation of these trusts vary from state to state. If you live in Nevada and are considering establishing a living trust, this guide will give you the information you need to set everything up. To help work your living trust in your financial plans, you might benefit from working with an estate planning attorney; you might also work with a financial advisor who can take a more holistic approach to your financial and estate plans.
How to Create a Living Trust in Nevada
There are five steps to creating a living trust in Nevada. They are:
For the process of actually writing the trust, there are a handful of online resources you can use to help outline everything correctly. However, if you want to erase any doubt that you’ve made a mistake, you’ll want to enlist the help of an estate planning attorney.What Is a Living Trust?
Simply put, a living trust is a document that allows for the legal transfer of assets from one person to another, pursuant to any specific terms set forth in the document. These assets and their eventual disbursement is the responsibility of a trustee. The creator, or grantor, of the trust names an individual to act as trustee when creating it.
There are two types of living trusts: revocable and irrevocable. A revocable living trust is flexible and allows for modifications and the removal of property and/or beneficiaries if needed. An irrevocable living trust, on the other hand, is permanent. Any asset that’s placed inside of it cannot be removed without permission from everyone named in the trust.
With a revocable living trust, you retain control of the assets you place inside. With an irrevocable living trust, you relinquish control of the assets for good. This means that taxes on the assets in an irrevocable trust apply separately to the trust, not to you.How Much Does It Cost to Create a Living Trust in Nevada?
A living trust in Nevada can cost significantly different amounts depending on how you go about setting it up. If you decide to go at it alone for instance, with the help of a book or an online guide it may run you $200 or less. Keep in mind, though, that DIY estate planning has its pitfalls.
Working with a professional will raise the overall cost of the process. If an attorney helps you draft your trust, the fees could easily exceed $1,000. Each attorney sets his or her own fees, so consult with your chosen attorney to get an estimate. If you’re looking for an attorney to help guide you, make sure you’re considering those who specialize in living trusts or estate planning, as well as those who have familiarity with Nevada laws.Why Get a Living Trust in Nevada?
The primary reason to create a living trust is that it allows your beneficiaries to avoid having to endure the probate process when you die. Probate is a potentially time-consuming process through which a local body known as the probate court processes an estate after a person dies. Creating a living trust lets your family avoid this potentially irritating endeavor.
Nevadans have a particularly good reason to get a living trust, as the state does not use the Uniform Probate Code. In states that do, this code simplifies the process for estates going through the probate court. Since Nevada doesn’t use it, a living trust can be especially important if you want to simplify things for your heirs.
A living trust can also be very useful if you are leaving property to a minor. If you designate another trustee for the property, he or she can hold it in the trust until the child reaches a certain age.Who Should Get a Living Trust in Nevada?
While a living trust can help more than just wealthy people, the size of your assets is an important factor to consider. A living trust may be especially beneficial for larger estates, as they tend to be more complicated. On the other end, Nevada has a simplified probate process for estates worth less than $100,000. For these estates, a living trust may be more trouble than it’s worth.Living Trusts vs. Wills
Even if you get a living trust, you’ll still need a will. If some piece of property doesn’t end up in the living trust, the will can make it clear whom that property should be passed to. Just as a trust has capabilities that a will does not, a will can do things that a trust cannot. These include:
The following table provides an overview of the capabilities of living trusts versus wills:Living Trusts vs. Wills Situation Living Trusts Wills Names a property beneficiary Yes Yes Allows revisions to be made Depends on type Yes Avoids probate court Yes No Requires a notary Yes No Names guardians for children No Yes Names an executor No Yes Requires witnesses No Yes Living Trusts and Taxes in Nevada
A living trust won’t have a big impact on your taxes in Nevada. Still, it’s smart to have a working knowledge of the estate and inheritance tax situations while you’re estate planning.
Luckily, there is no estate or inheritance tax in Nevada. The federal estate tax only applies to estates worth more than $11.4 million, or $22.8 million for a couple. This tax applies regardless of whether you have a living trust.Bottom Line
Creating a living trust in Nevada takes planning, but that doesn’t mean it’s impossible. You might find it helpful to get a professional’s help in drafting a living trust. However, you can also download the forms online and then take them to a notary public. Although you should have a will in place as well, a living trust can make life much easier for your family after you’ve passed away.Tips for Planning Your Estate
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