Achieve Flexibility in Uncertain Times with Trust Protector Provisions
The press is inundating all of us with news of President Trump and Congress attempting to overhaul the U.S. tax system. This news is creating much uncertainty and many clients are worried about how their estate plans may be affected. The truth is that, at this time, nobody knows exactly what will happen to the current estate and transfer tax system during the Trump administration (or in the next). So, what should you do now? Many commenters say nothing. However, the best answer is to make sure that your estate plan is flexible and adaptable to change.
Many modern estate plans include both revocable and irrevocable trusts. Most revocable trusts can be changed by the trustmaker while he or she is alive and mentally able. However, even revocable trusts usually become irrevocable upon the mental disability or death of the trustmaker. So, to achieve flexibility while a trust is irrevocable, a great first step is to include Trust Protector provisions. Properly drafted Trust Protector language permits a trusted family member or friend to appoint a third party, usually your estate planning attorney, to make appropriate changes to a trust even while the trust is irrevocable. This powerful tool allows clients and their families to protect themselves by being able to more easily adapt to a variety of future legal and tax changes.
If you would like to learn more about Trust Protector provisions, or other similar planning techniques, please consider calling Andrew Kelleher or David Buckley at (847) 382-9130. This writing is for discussion purposes only and is not legal advice.