FAQs on Ohio Legacy Trusts and Asset Protection
June 22nd, 2015
Q: What Is an Ohio Legacy Trust?
A: An Ohio Legacy Trust is an estate planning tool used by high net worth individuals and business owners to protect their assets from creditors who may come after them in the future. The trust can be funded with the owner's own assets, and the owner can be a beneficiary of the trust as well. Creditors generally cannot access assets in trust – even under extreme scenarios – provided that an experienced professional lawyer helps form these complex financial instruments. Ohio is one of only 14 states that allow the creation of this type of trust.
Q: How Is an Ohio Legacy Trust Created?
A: A seasoned estate planning attorney can help you establish and fine-tune this instrument. The trust must:
- Be irrevocable;
- Have a trustee who resides in Ohio;
- Have a spendthrift clause (this clause makes the trustee responsible for distributing assets from the trust);
- Be in writing;
- Be subject to Ohio law; and
- Include a signed statement that you are solvent at the time you contribute any assets to the trust, and you will still be solvent after you do it.
Q: What Is the Difference Between an Ohio Legacy Trust and a Revocable Trust?
A: You give up the control of the assets you put in an Ohio Legacy Trust. The trustee controls them. Therefore, you should not put all of your assets into it -- only a small portion of them. Also, you should not include any assets that are already encumbered, since the Ohio Legacy Trust protects your assets from future creditors, not current ones.
Establishing and funding an Ohio Legacy Trust can be a fraught business; a poorly conceived and structured trust can expose you to needless risks. Consider consulting Gudorf Law Group about how to effectively and seamlessly obtain this risk protection. Ted Gudorf is one of the only attorneys in Ohio who works regularly with high net worth individuals to establish these sophisticated legacy trusts. Call him and his team at 1-877-483-6730 for a free consultation.