Those who reside in Georgia may decide to include a trust as part of their estate plans. However, it may be possible to create the document in another state, and many people choose to locate their trusts in Delaware. Delaware is a popular option because beneficiaries who don’t live there don’t have to pay state income tax on distributions from a trust. Of course, it is possible that a beneficiary will owe taxes in his or her home state.
Delaware is also a popular state for those looking to keep terms of a trust hidden from a beneficiary. With quiet trusts, beneficiaries won’t find out about their inheritance until they reach a certain age. In some cases, trustees may be barred from ever telling beneficiaries about the trust. Those who are looking for a relatively easy way to transfer assets from one trust to another may appreciate Delaware’s decanting statute.
The state also allows for individuals to create perpetual and purpose trusts. These tools allow families to pass assets from one generation to the next without the need to pay gift or estate taxes. Finally, the state allows a grantor to create advisers to the trust, and these advisers will work with the trustees to make decisions about how assets are managed.
Determining where to locate a trust is one of many key decisions a person will likely make during the estate planning process. It may be a good idea to make those decisions with the help of an attorney. The attorney may be able to provide insight into who could be a worthwhile trustee or whether a beneficiary should know about his or her inheritance. Legal counsel may help a person review any estate plan documents that have already been created.