The Ohio Legacy Trust

The State of Ohio has recently stepped into the forefront of states allowing individuals to create their own trust, be the beneficiary of their trust, and protect their assets from nearly all general future creditors. In the past, one had to create expensive and sometimes risky offshore trusts to accomplish this purpose, or more recently create trusts in a few other states, but like the Alaska version, be required to hold assets in that state.

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Funding Your Living Trust

Once you have signed your living trust document, the next step is to change titles and beneficiary designations to your trust. This is called "funding" your living trust. This is probably the most important step in preparing a living trust. If you have signed your living trust document but haven't changed titles and beneficiary designations, you've simply wasted your money. You may have a great trust, but until you fund it, it doesn't control anything - because your living trust can only control the assets you put into it.

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Using Irrevocable Trusts in Medicaid Planning

People often wonder about the value of using irrevocable trusts in Medicaid planning. Certainly gifting of assets can be done outright, not involving an irrevocable trust. Outright gifts have the advantages of being simple to do with minimal costs involved, including the cost of preparing and recording deeds and the cost of preparing and filing a gift tax return. Many financial institutions have their own documents they use for changing ownership of assets so there are typically no out-of-pocket costs for the transferor

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Should You Move to a Roth IRA?

Tired of trying to meet all the rules on traditional tax-deferred saving plans? Consider switching to a Roth IRA. Contributions to a Roth IRA are not tax-deductible. But, unlike a traditional IRA, you don't have to start taking money out (or stop putting money in) at age 70 1/2. And, after five years or age 59 1/2 (whichever is later), distributions to you and your beneficiaries will be income tax-FREE.

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Private Charitable Foundation

Instead of giving all that tax money to Uncle Sam after you die and letting Congress decide how to spend it, you can set up your own charitable foundation, donate your assets to it and keep some control over how the money is spent! (The IRS does have a few restrictions on how the money is used.)

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Grantor Retained Annuity Trust (GRAT) and Retained Unitrust (GRUT)

GRATs and GRUTs have much in common with the qualified personal residence trust. The main difference is that a GRAT or GRUT lets you transfer any asset (not just your home) out of your taxable estate. And, with a GRAT or GRUT, you receive an income, instead of continuing to live in your home, for a set number of years.

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Family Limited Partnership

A family limited partnership lets you transfer assets like a family business, farm, real estate or stocks to your children now, yet you keep full control. Because you are removing these assets and any future appreciation on them from your taxable estate now, you reduce the amount of estate taxes that will have to be paid after you die. A family limited partnership is especially useful as a preventative measure when real estate or a family business might otherwise have to be liquidated to pay estate taxes.

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Offshore Asset Protection Trust

Because malpractice and liability insurance costs are so high -- and lawsuits so common -- some people have turned to offshore asset protection trusts as a way to protect their assets and still keep control. (Recently, several states including Alaska, Delaware and Utah have changed their laws and now allow similar trusts here in the U.S. These trusts, called domestic asset protection trusts, operate differently from the offshore trusts described here.)

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Naming A Beneficiary For Your IRA

While you should start with the general premise that all titles and beneficiary designations should be changed to your living trust, there are a few assets that you may not want in, or cannot be placed into, your living trust. Here are some you may own. 

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