The following are types of testamentary trusts that may be a good option for an individual and their family:
Testamentary trusts are often used when the beneficiaries are children – A Minor is not able to directly receive money from a will or inheritance.  When there is a minor in a will, a Testamentary Trust should be created. A Testamentary Trust will pass down assets to children or other minors. The trustee manages the testamentary trust on behalf of the minor until they reach the age set by the trust.  If you want to provide financial support for a disabled loved one, you should also create a Testamentary Trust. The financial support will come from the trust’s assets while not affecting their eligibility of government benefits.
Testamentary trusts are required to go through probate – Unlike other living trusts that may avoid probate, testamentary trusts must go through this court-supervised process. If probate has started, the probate court could check in on the administration of the testamentary trust.
Testamentary trusts often include life insurance proceeds – Although any number of different situations may make it beneficial for a person to set up a testamentary trust.  By having a life insurance policy with a substantial payout is one of the more common situations.  By setting up a Testamentary Trust is generally a smart idea.  If you want to learn more about possible tax breaks, please call us at 303-713-9147.