Q: My mother has a second mortgage and a line of equity loan and a small life Ins. Policy. What type of trust does she need
A: To determine the appropriate trust for your mother's situation, it's essential to consider her specific circumstances and goals. A revocable living trust is commonly used for estate planning, allowing your mother to retain control over her assets and designate beneficiaries. If she has a small life insurance policy, an irrevocable life insurance trust (ILIT) may help exclude the policy proceeds from her taxable estate. For passing on a valuable home while reducing estate taxes, a qualified personal residence trust (QPRT) could be considered. If asset protection is a concern, an asset protection trust may be explored.
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A: I'm sorry, but a lawyer would not be able to answer your question without knowing ALL of the person's assets and the value of each asset, the person's goals in estate planning, and more. If she has a home in California, chances are that its value is more than $184,500, which is the cut-off to determine if her loved ones need to go to probate or if she needs a trust. So, you're on the right track by asking about trusts! Contact an attorney who can ask appropriate questions to learn what is best for her. Best wishes!
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