Would you like to protect your child’s inheritance from passing to their spouse, from divorce, lawsuits, creditors, the Bankruptcy court, loss of government benefits, and even payment of future estate taxes?
The Kiselstein Franckowiak Law Group can design your estate plan in such a way that it allows your children, following your death, to protect their inheritance from all of the above dangers. This type of asset protection planning is done by establishing a PERSONAL ASSET TRUST℠(PAT) inside of your Revocable Living Trust. Think of it as a trust within your Trust.
A PERSONAL ASSET TRUST℠(PAT) can also be used to maximize the benefit of an inheritance for a beneficiary that is unable to make responsible financial decisions (a “spendthrift”) or has a drug or alcohol problem. In these types of situations, we would discuss appointing a Trustee that can hold assets in the PAT during the beneficiary’s life and have a broad standard to distribute assets to the person as necessary for his or her reasonable support and health.
The PERSONAL ASSET TRUST℠(PAT) is drafted to be flexible and to adapt to a beneficiary’s changing life stages or personal situations. It can even adapt to changes in state or federal law. Your revocable Trust will become irrevocable upon your death, often an undesirable result since an irrevocable trust is inflexible and cannot adapt or change. The PAT includes extensive “Trust Protector” provisions, which allow the Trust to adapt and provide the Trustee (usually the Trustee is your child) with flexibility. An example of this flexibility is the ability for the PAT to be converted to a “Supplemental Needs Trust” that would allow a disabled beneficiary to be eligible for state and federal benefit programs while remaining the beneficiary of this special trust. Another example is the ability to adapt from an Illinois Trust to a Trust of another state which your child may reside in, if that state has more favorable local tax laws.
What most clients like about a establishing PERSONAL ASSET TRUST℠(PAT) estate plans is that the PAT also allows you to control the ultimate distribution of those proceeds at the deaths of your children so that your estate will pass to your grandchildren rather than to in-laws (or other persons).
If you would like to find out more about the PERSONAL ASSET TRUST℠(PAT) and how it can protect your beneficiaries, call us at (847) 670-8200 to schedule an office visit with attorney Bruce Kiselstein or Lenore D. Franckowiak.
Thank you for all your help, especially for explaining everything to us. God bless you.