Klenk Law

Trusts Explained for Immigrants

Posted on Sat Jun 15, 2019, on Trusts

From Our “Ask a Question” Mailbag: “I am an immigrant from China. I read your articles, and could you please write an article about Trusts Explained for Immigrants?”

Trusts explained for immigrants

Peter Klenk, Estate Planning Lawyer, an Estate Planning Lawyer Near Me.

Trusts Explained for Immigrants.

After living for a year in Beijing, spending several years in Europe and being married to a Korean immigrant, I have spent much time explaining the Trust law concept to immigrants. It can be confusing, but I hope this article helps.

Trusts are excellent tools that can protect your property for your surviving spouse and children. But, they are a unique, British Common Law creation that doesn’t exist in most of the world. Because of their origin, many immigrants to the United States are unfamiliar with these fantastic tools. By not using them, your family can lose out on protection that might save your money or land from being taken.

What is a Trust?

A Trust is an estate planning tool with three essential parts. First, a Grantor who is the person who creates the trust. Second, a Trustee who is the person who holds the trust assets. Third, is the Beneficiary who is the person who benefits from the trust.

Trusts we first created to hold assets for a young heir who was not yet old enough to manage the property he inherited. For example, a British landowner might die with his eldest son being on 5-years old. The British landowner, in his Will, would “Grant” the power to a “trusted” friend to manage the farm for his son’s “benefit.” These are the origins of all the words we use. The land owner is the “Grantor.” The trusted friend is the “Trustee.” Finally, the son who benefits from this arrangement is the “Beneficiary.”

Who Owns the Trust Property?

Using the same example above, once the landowner died, he no longer owns the farm. The Trustee is holding and managing the farm, but the Trustee also does not own the farm.  The son is the beneficiary, but he also does not own the farm. So, who owns the farm?  The Trust owns the farm. Over many years the rules evolved to treat the Trust like a person. It may be a piece of paper, but it can own property, hire employees, pay taxes, and go to court. Because it is a piece of paper, though, the Trustee is its human personification. 

How Does a Trust Protect My Spouse and Children?

If you place your property into a properly drafted trust which follows the required laws, the trust owns the property for the benefit of your family. Your family does not own the property. If your spouse or child has a creditor, the creditor can only take what your spouse or child owns. They do not hold title to what is in the trust. So, the creditor cannot take the trust property. Furthermore, this is also true for your spouse if they should remarry after your death. The second spouse may file for divorce, but they cannot reach the property in the trust.

Trusts Explained for Immigrants, Examples

  • Mrs. Chang is a widow with two adult daughters. Her daughters have married, but she is concerned that should she die and leave her money to the daughters the money may end up with her sons-in-law. She has her Estate Planning Lawyer draft a will that forms a trust for each daughter. At her death, her money is divided equally into two trusts. Each daughter is the trustee of her trust. The cost to run the trust is nothing, as each daughter does all the work herself. Daughter one files for divorce, her trust is not part of the marital property, and her husband gets nothing from the trust.  Daughter two dies. After her death, Mrs. Chang’s terms drafted into the trust require that all remaining assets are divided equally between Daughter two’s children.  These shares continue in trust for Mrs. Chang’s grandchildren.  Though Daughter two’s husband survives her, he has no access to the trust funds. Mrs. Chang’s money continues in trust for her descendants.
  • Mr. Wang is worried that Mrs. Wang might be taken advantage of at his death. She has been diagnosed with Alzheimer’s. He has his estate planning lawyer draft a Will that forms a trust for his wife at his death. Mr. Wang dies, and his money goes into the trust for Wife. Mr. Wang designated his wife and son as co-trustees, requiring that they both sign all checks. The co-trustees pay all of Wife’s bills but, when scam artists try to steal Mrs. Wang’s money, they fail. Mrs. Wang could not give them a check by herself and when she tried to get her son to co-sign the check he detected the scam. The money is safe in the trust.  Mr. Wang could have hired a trust company or bank to be the trustee.  They also would have kept Mrs. Wang safe, but they would have charged a fee. Because Mr. Wang’s son does not charge for his time, the trust is free to run.
  • Mr. and Mrs. Kim wish to leave money for the education of their descendants. They have their estate planning lawyer draft Wills that form an Education Trust. At their deaths, the trust holds the money safe from their children’s divorces and creditors. The trust can continue forever, paying the tuition for grandchildren, great-grandchildren, and so on.

Is Setting Up a Trust Expensive?

No, most trusts are not expensive to create.  Most state governments, including Pennsylvania and New Jersey, have created Trust Acts that allow knowledgeable Estate Planners like ourselves form trusts like those described above and low prices. For no cost, we are happy to speak to you about your situation, develop a plan, and give you a quote.  You will likely be surprised how inexpensive protecting your family can be. Give us a call to set up a phone conference. 

In Conclusion: Trusts Explained for Immigrants

I hope you found this short article about Trusts helpful. I have also included some links for more detailed information. If you are curious about trusts, contact us and let our Estate Planning Lawyers help walk you through what can be a confusing process.

My Chinese is not good enough to explain these matters without the help of a translator. We can help locate a translator if you need one.

To begin with, call to speak to one of our Estate Planning Attorneys.  By all means, our lawyers are ready to answer your questions. In fact, feel free to contact our office for a free consultation. Ultimately our goal is to make the process as painless as possible!

Always happy to help the immigrant community, check out Celebrity Lashes owned by a successful immigrant businesswoman.

Wills, Trusts, Probate, and Estate Litigation, It’s All We Do!

It’s What We Do!

Tags:

Education Trust, Trust Under Will

What Our clients are saying

Stars

Peter provided outstanding advice and preparation of a will and trusts.

Stars

Peter was excellent. He explained everything very clearly and is super friendly. My wife and I originally tried using a lawyer through group legal coverage, but unfortunately the old adage - "you get what you pay for" - applied to the other lawyer, and we decided to go with a real professional.

Stars

When it came down to picking the right attorney to handle my affairs, I knew right away it was this firm. From speaking to their secretary to speaking to Peter I knew I was making the right decision. After only a few mins Peter knew right away what I was looking for and handled all my questions professionally and even gave me great feedback that put my mind at ease. All that without even giving a single penny! So of course I hired him! So far so good...

Stars

AWESOME LAWYER! Peter Klenk is an exceptional attorney and a very nice person! Today I spoke with Peter about estate planning and was impressed with by his professionalism, cordiality, and attention to detail. I highly recommend Klenk Law for probates, wills, trusts, and other issues germane to estate planning!

Stars

Great friendly staff

Stars

Tremendous firm with bright, kind and tenacious people. Great representation for our family.

Stars

I'm totally satisfied with Klenk Law. Peter has a great legal mind with the personality of the guy next door.

Stars

Everything about my experience was a 10+! Peter and his staff made what I thought would be a difficult process easy and understandable. Every detail was handled correctly. No other firm could possibly do better than Klenk Law!

Stars

Peter and his staff are very responsive and always willing to help my clients and in a cost efficient manner.

Stars

Like another reviewer, I contacted Peter through his website using the free consultation link, for a question regarding PA inheritance taxes. The question was quite technical and difficult to explain, and the answer was nowhere to be found on the web. Peter grasped precisely what I was asking, and provided a clear, helpful response (with a touch of humor) the very next day.

Stars

Answered my question quickly and referred me to a colleague that could handle my problem

Stars

Mr. Klenk, quickly understood the circumstances presented and provided clear and concise advice. This advice provided me with the information I required to progress the case to my advantage.

Stars

Peter is excellent. I had a very complicated situation with my parents' estate planning and potential Medicaid needs. Peter was very knowledgeable in estate planning matters, able to define the best solution for the situation. Additionally, he was congenial and able to communicate effectively to my senior citizen parents the benefits of estate planning. He earned my trust, and more importantly, my parents' trust in a 45 mins consultation period. Highly recommend Peter. He is very easy to work with.

Stars

Peter recently gave a presentation about Wills & Trusts at my employer, and it was fantastic! He was extremely knowledgeable and provided valuable information to the group. People were very engaged and asked several questions, all of which Peter thoroughly answered. Personally, my husband and I have selected Peter to help us with our estate planning, and he has been very helpful in providing us with all of the information we need to provide a secure future for our family. Thank you, Peter!

Stars

Peter provided outstanding advice and preparation of a will and trusts.

Stars

Peter explained things in a way that was easy to understand. Everything was done in the time frame he said it. Could not have been better!

Stars

You & your staff are the best thank you for everything.

Stars

Peter and his staff handled all of our needs in a very professional and timely matter.

Stars

Peter Klenk made a complex subject understandable and allowed us to move forward with our estate planning. He was patient with our questions and creative in the solutions he proposed.

Stars

Peter explained a complex subject very clearly, helped us to decide the best approach to managing our estate and then made it very easy for us to execute the required documents. He will be a valuable resource for years to come and clearly has a great understanding of estate law that will lead to innovative solutions for us. I would unhesitatingly recommend him for estate planning.

Stars

Fantastic customer service. Very personable and most importantly they provide great explanations of what is required based on your individual needs. Highly recommend Klenk Law for anyone that needs to create a will and estate documents.

Stars

Always professional and very responsive. Everyone on the staff that I have worked with. I look forward to continuing our relationship.

Stars

Surprisingly easy

Stars

Affable...yet surprisingly cerebral estate planning atty. High marks all the way around.

Stars

Peter and his associates made things easy for us.

Let us put our expertise to work for you.

Free consultation within 24 hours.