Trusts are a popular estate planning tool in Texas, allowing you to protect and distribute your assets in a variety of ways.
A trust is a legal arrangement in which a person’s assets are held by a trustee for the benefit of one or more beneficiaries.
Trusts can be used to avoid probate, protect assets from creditors, and provide for loved ones who may need special care or attention.
There are several types of trusts available in Texas, each with its own advantages and disadvantages. The best type of trust for you will depend on factors such as the size of your estate, the types of assets you own, and the needs of your beneficiaries.
You can read more about the details of Trusts in Texas below. If you have any questions, please contact our Waco trust lawyers online or call (254) 252-3590.
Key Takeaways
What Waco Families Should Know Before Setting Up A Trust
Choosing the right trust matters as much as deciding to create one. Waco trust lawyers at Zimmerman Law Firm help Central Texas families match the trust structure to their actual goals, whether that means avoiding probate, protecting a loved one’s benefits, or passing down a firearm collection.
- A trust can help your family avoid the time, cost, and public record of probate court, something a will alone cannot do.
- Waco trust attorneys build revocable, irrevocable, testamentary, and charitable trusts around each family’s specific estate planning goals.
- Specialized options like supplemental needs trusts and gun trusts protect specific beneficiaries and assets under Texas and federal law.
- Zimmerman Law Firm has served Waco, Temple, Killeen, and the surrounding Central Texas counties for over 50 years.
What Are Revocable Living Trusts?
One of the most common types of trusts in Texas is a revocable living trust. This type of trust allows the settlor (the person creating the trust) to maintain control over the assets in the trust during their lifetime. The settlor can also make changes to the trust at any time or revoke it altogether.
Upon the settlor’s death, the assets in the trust are distributed to the beneficiaries named in the trust. One of the advantages of a revocable living trust is that it can help avoid probate, which can be a lengthy and expensive process in Texas.
What Are Irrevocable Trusts?
Unlike a revocable living trust, an irrevocable trust cannot be changed or revoked once it has been established.
This type of trust is often used for tax planning purposes, as assets placed in the trust are removed from the settlor’s estate and may be subject to fewer taxes.
What Are Testamentary Trusts?
A testamentary trust is a trust that is created through the settlor’s Will and takes effect only after the settlor’s death.
One advantage of a testamentary trust is that it can be used to protect assets from creditors or to distribute assets to beneficiaries over time.
Another advantage is that a testamentary trust can help avoid the need for a guardianship, which can be time-consuming and expensive.
However, one disadvantage of a testamentary trust is that it is subject to probate, which can be a lengthy and costly process.
Additionally, the terms of a testamentary trust are public record, which may not be desirable for some individuals.
Planning For Your Family’s Future Shouldn’t Feel Overwhelming
Thinking through trusts, trustees, and what happens to the people you love can bring up a lot of questions, and even more emotions. You don’t have to figure it out alone. Our team is here to listen, walk you through your options in plain language, and help you build a plan that gives you real peace of mind.
Schedule A Free ConsultationWhat Are Charitable Trusts?
Charitable trusts are designed to support a charitable cause or organization. In Texas, there are two types of charitable trusts, charitable remainder trusts and charitable lead trusts.
A charitable remainder trust allows the settlor to receive income from the trust during their lifetime, with the remaining assets going to a designated charity upon the settlor’s death.
A charitable lead trust, on the other hand, provides income to a designated charity for a set period of time, with the remaining assets going to the settlor’s beneficiaries.
What Are Supplemental Needs Trusts?
Supplemental needs trusts (also known as special needs trusts) are designed to provide for the care of a beneficiary with special needs, without jeopardizing their eligibility for government benefits such as Medicaid or Supplemental Security Income (SSI).
There are two types of supplemental needs trusts, first-party supplemental needs trusts and third-party supplemental needs trusts.
A first-party supplemental needs trust is created using the assets of the individual with special needs. This type of trust is useful in situations where the individual with special needs receives a settlement or inheritance but is required to contain a payback provision.
This means that any remaining assets in the trust after the individual with special needs passes away must be used to reimburse the state for benefits received by the individual.
A third-party supplemental needs trust is created using the assets of someone other than the individual with special needs.
This type of trust is commonly used by parents or other family members to provide financial support for individuals with special needs.
Unlike a first-party supplemental needs trust, a third-party supplemental needs trust is not required to contain a payback provision.
What Are Gun Trusts?
A gun trust is a trust created to legally own and manage firearms, including Title II weapons under the National Firearms Act (NFA), such as machine guns, submachine guns, sawed-off shotguns, short-barreled rifles, and silencers.
By creating a gun trust, you can provide for the proper transfer of firearms upon your death, avoiding the possibility of accidentally violating federal laws related to gun ownership and transfer.
Additionally, a gun trust may provide some protection against liability for accidents or injuries involving the firearms held by the trust.
FAQ
Trust Questions Waco Families Ask Us Most
Our Waco trust attorneys hear these questions often from Central Texas families weighing a trust against a will. Here are straightforward answers to help you decide what fits your situation.
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Yes, in many cases. A will alone still requires probate court, while a properly funded trust lets your assets pass to beneficiaries privately and often without court involvement. Waco trust attorneys frequently pair a will and a trust so nothing falls through the cracks, especially for real estate or business interests.
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A living trust holds title to your assets during your lifetime, so when you pass away your successor trustee can distribute them directly to your beneficiaries without opening a probate case. This keeps the process private, typically faster, and avoids McLennan County probate court fees and delays.
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A gun trust is a specialized trust that holds title to firearms, including NFA-regulated items like suppressors and short-barreled rifles, so they can be legally shared among trustees and passed to beneficiaries. If you own or plan to acquire regulated firearms, a gun trust helps you stay compliant with federal transfer rules.
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Yes. A supplemental needs trust holds assets for a person with a disability without counting them against income limits for programs like Medicaid or SSI. Waco trust lawyers can set up a first-party or third-party version depending on whose assets are funding the trust.
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Cost depends on the type and complexity of the trust, since a simple revocable living trust costs less than one with charitable, special needs, or firearms provisions. The best way to get an accurate number is a consultation, where a Waco trust attorney can review your goals and quote a flat fee.
Get in Contact with a Waco, Texas Trust Attorney Today
Trusts are a valuable estate planning tool in Texas, providing a wide range of benefits to settlors and beneficiaries alike.
Whether you are looking to avoid probate, reduce taxes, protect assets from creditors, support a charitable cause, or provide for a beneficiary with special needs, there is likely a trust that can help you achieve your goals. Our trust lawyers are here to help you through every step.
However, setting up a trust can be complex, and it is essential to work with an experienced estate planning attorney to ensure that the trust is established correctly.
It has been our honor to help the people of Waco, Temple, Killeen, Round Rock, Austin, and the surrounding area for over 50 years. We serve clients in McLennan, Hill, Limestone, Falls, Bell, Coryell, and Bosque Counties.
If you are considering creating a trust, contact our Central Texas estate planning attorneys today by filling out our online form or calling us at (254) 252-3590.
Where You Can Find Our Waco, TX Office