A solid Georgia estate plan will allow your assets to pass to your beneficiaries with the lowest possible estate tax cost. A good estate plan will also pass your assets in a form that best meets your desires and the needs of your beneficiaries.
Trusts are an important tool to ensure that assets pass to a beneficiary in an appropriate manner. Trusts are especially important if your beneficiary falls under one of these following four categories:
Minors: if a minor will be the beneficiary of your estate, a trust can help protect the minor from the unintended consequences of an inheritance. A court-appointed guardian will manage the minor's inheritance until the minor turns 18, but without a trust in place the minor will receive the entire inheritance on his or her 18th birthday.
Most young adults are not capable of managing significant amounts of money at age 18. Giving a young adult a bulk inheritance payment at age 18 may cause significant problems and a trust can ensure that the funds are managed prudently.
Financial insecure individuals: if you believe that your beneficiary spends wastefully or has creditor problems, a trust can help protect that beneficiary's assets from creditors and the beneficiary's own habits.
Divorcees: although inheritances are generally exempt from the property division process during a divorce, a trust can ensure that the inheritance funds are not comingled with martial fund, which may subject them to division.
Disabled beneficiaries: an inheritance may make a disabled beneficiary ineligible for government assistance. A special needs trust will hold the funds for the beneficiary and allow the beneficiary to receive government aid for basic needs such as food and shelter while paying for recreational activities, education, and medical needs, among other things.
Source: The Times Reporter, "Trusts are useful for special beneficiary situations," James Contini, 4/30/11