An estate planning trust contains language that controls the distribution of trust assets to trust beneficiaries. This language can provide that the beneficiaries receive their inheritance in one lump sum or spread out over time with distributions linked to the beneficiary’s age or specific accomplishments such as graduation from college. Unfortunately, once a beneficiary receives their inheritance their creditors can obtain a court order seizing those funds and transferring them to the creditors.
An estate planning trust contains language that controls the distribution of trust assets to trust beneficiaries. This language can provide that the beneficiaries receive their inheritance in one lump sum or spread out over time with distributions linked to the beneficiary’s age or specific accomplishments such as graduation from college. Unfortunately, once a beneficiary receives their inheritance their creditors can obtain a court order seizing those funds and transferring them to the creditors.
An estate planning trust does not protect your assets from your creditors. However, following your death a well-drafted trust can protect your beneficiaries’ inheritance from their business creditors as well as their ex-spouse and other personal creditors. In my experience, most estate planning attorneys do not know how to draft a trust that offers this type of protection to beneficiaries.
For the past several years I have offered my clients an opportunity to include lifetime asset protection features in their estate planning trust. If your estate planning trust does not already include this feature please contact me to learn more about how you can protect your beneficiaries’ inheritance from attack by their creditors.