Tax authorities and creditors are the two primary threats to the value of an estate in Massachusetts. Thankfully, however, a certain amount of asset protection can be achieved through proper estate planning. Taking the appropriate steps prior to death can help ensure that an individual's heirs and beneficiaries receive the maximum benefit from the estate.
A last will and testament is the first step in this process. It ensures that a person's assets will not come under the purview of the state of Massachusetts for distribution. It provides where an individual's assets are to go after death.
Many individuals take the process a step further and create a trust to hold their assets. A trust gives its creator (grantor) the opportunity to determine when beneficiaries will receive distributions from the trust. These instructions can be as specific as the grantor desires in order to provide for loved ones as they wish. Further, the property held in the trust will not be subject to probate. Other assets will not go through probate, such as life insurance policies and retirement accounts, because their distribution is governed by beneficiary designations.
Estate planning can be tailored according to an individual's needs. The completed plan can provide for loved ones, reduce or eliminate estate taxes and protect property from creditors. Asset protection after death is just as important as protecting assets during life. Therefore, it would be beneficial to discuss the possibilities with an attorney who can help design an estate plan that meets or exceeds all of a person's goals.
Source: nasdaq.com, "4 Strategies to Avoid an Estate-Planning Mishap", C. Grant Conness, Aug. 2, 2016