Can I Create a Trust for My Grandchildren?
Your family may be the center of your life, and you may have worked hard to sustain them financially. And so, when you sadly pass on, you may wish for your legacy and financial assistance to last for more than just one generation of family members. That is, you may love your grandchildren as much as your own children, and hope they can remember you, your love, and your support for the rest of their lifetimes. With this, you may want a trust to serve as this constant reminder to them. Well, please read on to discover whether you can create a trust specifically for your grandchildren and how one of the seasoned Butler County trust attorneys at Heritage Elder Law & Estate Planning, LLC can help you consider this option carefully.
Can I create a trust for my grandchildren in Pennsylvania?
There are many accepted trust types in the Commonwealth of Pennsylvania, one of them being the generation-skipping trust. This trust may allow you to transfer assets to beneficiaries who are at least two generations your junior, starting with your grandchildren. Of note, you may also set up this trust for great-nieces, great-nephews, or other close family members who are at least 37.5 years younger than you. In this way, you may almost ensure that your estate’s assets last and extend to multiple generations of family members.
It is worth mentioning that a generation-skipping trust falls under the irrevocable trust category. Meaning, you may find difficulty in revoking or modifying it throughout your lifetime. But still, this may ensure better asset protections and tax clearances for your grandchildren than a revocable trust type would.
Why would I want to create a generation-skipping trust?
Upon initial thought, you may think it would be cold or unfair to skip over your children to establish trusts for your grandchildren. However, this is not necessarily true. This is because you still have the power to create individual trusts for each of your children. And since the assets you use to fund your generation-skipping trust are obviously not a part of your children’s trusts, they will be able to maintain full control over their trusts’ assets throughout their lifetime.
Also, it can be argued that your children may still benefit from a generation-skipping trust. This is because, while they may not have direct access to the principal assets, they may still be able to receive the earnings they generate. This is all while avoiding tax implications from this earned income.
If you have gotten this far, we now ask you to reach out to one of the competent Butler County estate planning & probate attorneys to schedule an initial consultation. Overall, we strongly encourage you to retain legal representation from Heritage Elder & Estate Planning, LLC for all your estate planning needs.
