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Estate Planning & Trust Administration

Unlike many investment managers, we also possess nationally chartered trust powers.  In the areas of trust administration and estate planning, we believe that almost everyone needs a current Will, along with advanced directives that set out your wishes for health care at end of life or if you become unable to decide for yourself as a result of injury or illness. Without this minimal level of planning, it may be the courts (not your family) that decide who is to receive your property at death or the type of medical care you receive if you become incapacitated. Also, without additional estate planning (which may include establishment of a living trust, making lifetime gifts, or purchasing life insurance either directly or by setting up an irrevocable life insurance trust), a significant portion of your wealth may end up being paid out in the form of federal estate taxes and/or state inheritance taxes, rather than to your children or grandchildren. We will help you to understand your options.

A trust is simply a separate legal entity (like an individual or a partnership or a corporation) that is created separately to own assets for the benefit of yourself and/or others (known as the trust beneficiaries). A living trust is a trust that is created while you are alive, and is revocable, meaning you can choose to change any of its terms at any time, or even terminate the trust all together. The bottom line is that you maintain control at all times. The trust beneficiaries may include the person(s) making the trust, and may also include others, such as children or grandchildren, or even charitable organizations; it is up to you (and your attorney) how to structure your trust.

The trust is governed by a written trust agreement that spells out its exact terms (for example: how, when and to whom to distribute the principal or income of the trust), and who is responsible for ensuring that the trust provisions are properly carried out (the “trustee”, who can be you and your spouse or any trusted third-party).

Contrary to popular belief, you do not have to be a millionaire to benefit by establishing a trust. There are numerous advantages for anyone wishing to establish a living trust, which may include:

  • Avoiding probate (the legal process of settling an estate disposed of by a Will). Avoiding probate serves to save time and attorney costs which may be up to 2% of the value of your estate (in fact, regardless of your net worth, if you own real estate in two or more states, you should strongly consider a trust to avoid having to probate your estate in multiple states);
  • Privacy. A Will is a public document when filed after your death (for example, Michael Jackson’s is now a public document), while a trust agreement is generally not required to be publicly-filed;
  • Trustee(s) can maintain complete control of the trust assets and trust terms for as long as they desire or are able (and your same individual 1040 income tax return may be filed just like before);
  • It can provide direction to a successor trustee in the event of a disabling injury or illness, so no court-appointed guardian or conservator is required;
  • If a corporate trustee (bank) is chosen, the trustee can provide professional asset management, recordkeeping and bill paying, and also handle distributions to beneficiaries;
  • It can reduce estate tax liabilities if properly set-up to achieve that goal; and
  • It can provide protection from creditors since creditors cannot reach an heir’s interest in the trust. We can offer you peace of mind.

In addition, regardless of where you live or where your assets are located, you may establish your trust in South Dakota provided that your trust agreement states that South Dakota law governs the trust terms, and at least one trustee is a resident of South Dakota (Liberty National Bank’s Wealth Management Division is a SD resident), and the trust is administered in South Dakota.

Why might it be important for you to establish your trust in South Dakota?

It would make good sense to do so if you desire to obtain the unique benefits of South Dakota trust laws. Unlike most states whose trust laws limit how long a trust can last, South Dakota is one of the few states that have no such time limits; therefore, your properly established South Dakota trust can remain active and grow forever. Also, South Dakota is one of only a hand-full of states with no state Income tax —and we also have no state Inheritance tax and no state Estate tax —therefore, your South Dakota trust can accumulate more capital and create more wealth for future generations. Finally, South Dakota’s trust-friendly legislature has enacted numerous modern and flexible trust administration statutes, including spendthrift and privacy laws.

In the event that your estate plan includes the creation of a trust, whether it is a SD trust or a trust created in any other state, we can act as your sole trustee, as a co-trustee along with you, or we can act as a successor trustee ready to manage and administer your trust on behalf of your beneficiaries should you pass away or become unable to manage things on your own. We can offer you peace of mind.

We have been helping families achieve their financial goals since 1993 including the administration of numerous types of trusts.

  • South Dakota Dynasty Trust (multi-generational trust)
  • South Dakota Legacy Land Trust (multi-generational trust)
  • Testamentary Trust (Trust Under Will or Pour-over Will)
  • Revocable Living Trust (RLT)
  • Marital Trust, i.e., QTIP
  • Credit Shelter Trust
  • Irrevocable Life Insurance Trust (ILIT)
  • Charitable Trusts, i.e., CRT, CLT
  • Third-party farm management services
  • Conservatorships / Guardianships
  • Endowments / Foundations

If you want to obtain financial peace of mind, we are here to help you. We invite you to learn more about Liberty National Bank’s Wealth Management Division by contacting our professionals at your convenience.

 

 
Investments Not FDIC Insured – May Lose Value – No Bank Guarantee.

The information contained herein is for general informational purposes only. It is not intended to, and does not, constitute legal advice. For legal advice, please consult your attorney.