Dynasty Trust

Beneficiary Asset Protection Trust in Arizona

Beneficiary Asset Protection Trust in Arizona

9 Benefits of a BAPT in Arizona

Are you wondering if a Beneficiary Asset Protection Trust is right for you? Click here for nine great benefits of having a BAPT in Arizona to help you decide.

Have you been thinking about what will happen to your assets after you die? Maybe you have started looking into your trust options to make sure you have asset protection.

But have you learned about a BAPT yet? An Asset Protection Trust, otherwise known as a Beneficiary Asset Protection Trust or Domestic Asset Protection Trusts , is a trust that can benefit you in so many ways. It works to protect assets for your family and your heirs.

If you want your assets safe and sound, then this is a great trust to look into. You, the grantor, will be able to create the trust and transfer any assets into it. Someone will manage the trust and then distribute assets to the beneficiaries based on what the grantor lays out.

Curious to learn more? Keep reading for more benefits of having a BAPT.

1. Creditor Protection

One benefit of a BAPT in Arizona is creditor protection.

All assets held in a trust are protected from the beneficiary's creditors. That means that if anything happens with a beneficiary such as them getting sued or declaring bankruptcy, the assets in the trust are protected. This is what you want when you have a trust.

This will protect the assets from creditors or debt collectors.

2. Lawsuit Protection

In addition to creditor protection, an asset protection trust will also provide lawsuit protection.

If something happens to the beneficiary such as them getting sued, the assets in the trust will be protected. This means the assets in the trust cannot be used against the beneficiary at all. They will remain in the trust because of the protection that the Beneficiary Asset Protection Trust holds.

3. Extra Privacy

A BAPT can provide extra privacy for any beneficiaries who do not want any of their information public. This is especially true for financial information.

The asset protection trust will protect the trust assets from the public eye.

4. Asset Management

Asset management is a huge part of a Beneficiary Asset Protection Trust. It makes sure that all assets within the trust are properly managed.

This can have to do with investment decisions, monitoring market conditions, and adjusting asset allocation depending on certain conditions.

With a BAPT, a grantor can choose the professional asset manager to manage the trust's assets. This can benefit the beneficiaries because of the knowledge that the professional asset manager has on the trust.

Working with an estate planning attorney that has a background in finance can help you define the correct asset protection planning for your family trust.

5. Divorce Protection

The divorce rate in America stands around 2.5 out of 1000 people.

It is still a high number, and many people fear getting divorced. Part of this is because of trying to figure out where their assets go.

A BAPT can protect assets from getting separated and divided during a divorce settlement. If you want your beneficiaries' assets to be protected, then having a BAPT is an important part of doing so as it provides divorce protection from dividing assets. That is specially true if you setting up a asset protection trust for your children and you are afraid of them getting divorced.

Differently from a revocable living trust that can be changed, asset protection trusts when properly set up will prevent your property to be transferred our of your blood line. That is because BAPTs are usually irrevocable trusts. Estate planning attorneys sometimes call this type of trust a dynasty trust or domestic asset protection trust.

6. More Control for the Grantor

With a BAPT, a grantor has more control over the assets within the BAPT. This can be important for a grantor who wants to make sure that their assets are distributed in a way that they want.

With other type of trusts, this is not always the case. The grantor doesn't always have the amount of control that they want after they pass away. Asset protection trusts work in a way that they can't be changed after the passing of the grantor.

However, a BAPT gives more flexibility when it comes to where the assets go and how they are distributed among beneficiaries. The grantor is able to specify the conditions that the beneficiaries can meet before receiving the trust's assets as well. For instance, stating that they must graduate college before receiving distributions could be one condition. At our law firm we prefer to also add an age limit to our trusts as well.

7. Multigenerational Planning

When it comes to trust assets, there is a lot more that goes into it than just wondering what happens to the next generation.

That's why a BAPT can be beneficial because it does more than just name the next in line. It takes multigenerational planning into account. In the very unfortunate event that your children pass away before your assets can go directly to your children.

It can ensure that assets that are in the trust continue to pass down to future generations. It can also lay out how this should be done in the guidelines - such as who the assets should go to as well as when.

8. Avoidance of Probate

A BAPT can be beneficial when it comes to avoiding probate. Probate can be lengthy and costly, so it is best to avoid.

With a BAPT, you will be able to avoid the court process that has to validate the will and the trust. Instead, the BAPT will allow one to bypass this so that assets can be distributed as it states.

The trust will still go through the trust administration process. That process is much easier and it is a private process. That way the trust assets stay protected.

9. Estate Tax Planning

No one wants to incur estate taxes. A BAPT can help to protect against that.

It can be an effective tool for estate tax planning because it can allow for the transfer of wealth from generation to generation without incurring any estate taxes, which can put a huge dent in assets.

This ensures that what is yours stays with you and your family. That is specially important if you have a large state. Working with an experienced estate planning attorney is specially important in this case.

Benefits of a BAPT in Arizona

We hope our blog article helps you if you have been thinking about getting a Beneficiary Asset Protection Trust in the state of Arizona. There are so many benefits of having one.

Whether you are more worried about divorce protection or estate tax planning, a BAPT can help with both. Not only that, but there are so many other benefits as we mentioned above.

If you have any questions about a BAPT or need help figuring out what happens next, you can contact our lawyers at Citadel Law Firm! We are here to make sure that your assets are protected.

Call (480)565-8020 or click here to schedule your free estate planning consultation with our experienced estate planning attorneys. Call today, we love to help.