If you’re planning your estate in Nevada, you probably want to leave a sizeable share of assets to your loved ones. Unfortunately, you might be worried about what will happen to those assets once they transfer to your beneficiaries. Creditors may be able to seize your beneficiary’s inheritance, essentially making it worthless.
How you can protect your assets
During the estate planning process, you may dictate how you want various assets distributed in your will. As a result, the assets will transfer directly to the beneficiaries after your death. This means that they’ll have direct ownership of the assets, and as a result, creditors may seize their inheritance to pay off their debts.
To protect your beneficiary’s assets, your estate planning attorney may recommend setting up an irrevocable trust. You can place properties, investments, stocks, bonds and other assets in the trust and then appoint a trustee to manage it after you’re gone. You’ll also name a beneficiary to receive the assets.
When you die, your assets won’t transfer directly to your beneficiary. Instead, they’ll remain in the trust. This means that creditors can’t seize your beneficiary’s inheritance since they don’t technically own the assets. The trustee could distribute assets to help your beneficiary pay for rent, a car and other utilities, but your beneficiary can’t withdraw assets whenever he or she wants.
If you talk to an attorney, he or she may suggest other ways to protect your estate from creditors. A lawyer also may discuss ways that you can lower the taxes, so your beneficiaries don’t have to pay a massive inheritance tax after your death.
How can you start planning your estate?
Writing a will may seem easy enough, but your beneficiaries may have to deal with taxes, penalties and predatory creditors after your death. An attorney could talk to you about legal forms of protection that will allow your loved ones to enjoy as much of their inheritance as possible.
Depending on the situation, your attorney may recommend setting up an irrevocable trust or a limited liability company. You may have to appoint a trusted individual to manage your assets after you’re gone.