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GIFTING AND LEGACY PLANNING

Core trusts

At its most basic, a trust is a legal entity you create to hold certain assets in the care of a trustee for the benefit of the trust’s beneficiaries. Examples of assets that can be held in a trust include financial accounts, real estate holdings and private business interests.

The type of trust you choose depends on your specific objectives and the trust’s role in your overall wealth plan.

 

Revocable trusts

A revocable trust, also known as a living trust, is flexible, allowing you to retain as much control as you like over your assets. You can withdraw from or change the terms of your trust at any time. You can be the trustee, either alone or with someone else you appoint. Revocable trusts can be beneficial when you want to:

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  • Avoid or minimize the probate process.
  • Facilitate the management of your assets.
  • Control how your assets are to be distributed to your heirs.
  • Ensure your assets are professionally managed in the event you become incapacitated.

It’s important to note that assets in arevocable trust remain part of your taxable estate. Bank of America Trust Services can help with the establishment and management of your revocable trust by:

 

  • Assisting with investment management and bill payment.
  • Serving as co-trustee with you during your lifetime.
  • Serving as successor trustee in the event of your incapacity or death.

Irrevocable trusts

A key reason many people choose an irrevocable trust is to minimize estate taxes, as assets in an irrevocable trust are not considered part of your taxable estate. However, changing the terms of an established irrevocable trust is a complex legal process, so you’ll want to make sure you have sufficient assets for your own living expenses outside of the trust. Irrevocable trusts can be beneficial when you want to:

 

  • Minimize federal and state wealth transfer taxes.
  • Use a third party, not yourself or a family member, to control how your assets are managed, distributed and spent.
  • Provide for a spouse or children from a previous marriage.
  • Guard against heirs managing or using the assets unwisely or being influenced by someone else to do so.

Bank of America Trust Services can help with the establishment and management of your irrevocable trust by:

 

  • Serving as sole trustee, assuming all fiduciary duties.
  • Serving as co-trustee.
  • Help an individual trustee with administrative and investment responsibilities.

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