How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.
A new question is answered every 9 seconds

Ask an Estate Lawyer

Thomas McJD
Thomas McJD, Attorney
Category: General
Satisfied Customers: 3170
Experience:  Wills, Trusts, Probate & other Estate Matters
19305272
Type Your Estate Law Question Here...
characters left:
8 Estate Lawyers are Online Now

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
< Last | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin Kernersville, NC
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther Woodstock, NY
  • Thank you so much for taking your time and knowledge to support my concerns. Not only did you answer my questions, you even took it a step further with replying with more pertinent information I needed to know. Robin Elkton, Maryland
  • He answered my question promptly and gave me accurate, detailed information. If all of your experts are half as good, you have a great thing going here. Diane Dallas, TX
 
 
 

Credit Shelter Trusts

A credit shelter trust is a trust that is available to married individuals in order to avoid estate taxes when they leave assets to their heirs. A credit shelter trust is created so that in the event of the death of the investor, the assets that are listed within the trust and in the trust agreement are transferred to the beneficiaries of the trust. The advantage of a credit shelter trust is that the spouse of the investor holds the rights to the trust assets and the income that is created by the assets during the rest of their lifetime. Given below are a few questions answered by the Experts on credit shelter trust related issues.

Can a deceased parent’s credit shelter trust lend money to a beneficiary to avoid paying taxes on a loan?

In this case, the only way the individual could do this is if the trust terms allow for the loan. If they do, the trust can offer a loan to the beneficiary and they wouldn’t have to pay taxes on the loan. However, if interest is earned on the loan, the trust would be required to pay income tax on the loan unless distribution of income is allowed by the trust. If so, income tax from the interest would need to be paid by the beneficiaries who get the income. Now, if the trust does not allow a loan, the loan cannot be sanctioned. Normally, if the trustee is given the authority to make investments, they would be allowed to loan the money to the beneficiary. If this is done, the trustee would need to make sure that they are not violating their trust agreement that may require careful investments. This could mean that loans can only be given based on a set of stringent terms much like a third party loan.

In a credit shelter trust, is the trust required to file a tax return? If so, who is responsible for paying the taxes?

This type of trust is required to submit a separate tax return. This is because the credit shelter trust will have a differed taxpayer identification number. In many cases, the funds from the credit shelter trust are divided between the beneficiaries and the beneficiaries will be responsible for paying the taxes on these funds. The credit shelter trust tax return will be required to have a Schedule K-1 that states how the funds were divided between those involved. However, the credit shelter trust can also be taxed if the funds are not divided, or there are capital gains from the sale of a capital possession. It will then be the trustee’s responsibility to maintain and pay all the taxes of the credit shelter trust.

If an individual created a credit shelter trust in the State of Colorado and then moved to Hawaii, would they be required to have the trust and will changed or send a written letter with the changed address?

If the will and credit shelter trust were both created correctly according to the state laws of Colorado, they will still be upheld in the new state the individual has decided to move to. If the only change is the address, the individual is not required to provide a legal written notice of the address change.

What will happen if a credit shelter trust was not supported with funds before the grantor’s death? Can the funds still be transferred to the trust after their death?

In most cases, credit shelter trusts are not required to be funded until the death of the grantor. This type of trust is intended to protect a person’s estate tax exemption from being lost by way of property being moved to the surviving spouse.

Setting up a credit shelter trust and understanding the terms and conditions of this trust are not always easy. Individuals can have many questions about running the trust, tax payments and so on. In these situations, it is always better to seek a professional’s help. Put your questions to the Experts now for quick and insightful information to help you with your own case.

Ask an Estate Lawyer

Thomas McJD
Thomas McJD, Attorney
Category: General
Satisfied Customers: 3170
Experience:  Wills, Trusts, Probate & other Estate Matters
19305272
Type Your Estate Law Question Here...
characters left:
8 Estate Lawyers are Online Now

How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Estate Lawyers are online & ready to help you now

Ron
ASE Certified Technician
Satisfied Customers: 21584
23 years with Ford specializing in drivability and electrical and AC. Ford certs and ASE Certs
Dr. Y.
Urologist
Satisfied Customers: 18594
I am fellowship trained specializing in general urology and reconstructive urology.
John
Home Appliance Technician
Satisfied Customers: 13453
Appliance repair business owner for over 43 years.

Recent Credit Shelter Questions

  • My father set up a living trust with my name as trustee and

    My father set up a living trust with my name as trustee and my brother as trustee. We had helped our father financially. There are two other siblings that have been no where around the last ten years that I know of. Is that trust supposed to be split equally amoung all four of us in the state of New Mexico? My father passed a way May 10th. 2013 He left no will. The money was intended to pay remaining bills and then to split between my brother an myself. I want to make sure I am not breaking the law.It is a living trust. NOT REVOCABLE upon death. There are no other assets

  • I live in South Carolina, disabled and receive $1312.00 SS disability per month... My wif

    I live in South Carolina, disabled and receive $1312.00 SS disability per month... My wife works part-time and cares for me the rest of the time and makes $600.00 per month... I have liens filed against a business we used to own ("C Corp") that we ran from 2008 to 2012 before I became disabled... I have not shut down the (C-Corp) yet and I need to get some high-risk life insurance... I am currently awaiting a Liver Transplant...
    My question is can the people and/or companies that have liens filed against my (C-Corp) get any of my life insurance that I am leaving to my Wife if I do not survive my Liver operation...??
  • my son died last month without a will he owns no house only

    my son died last month without a will he owns no house only cars that he want his daughters to have and a bank account I am his mother who had to pay his funeral cost. how do I get power of attorney of his affairs so I can give his children there cars/
< Last | Next >
View More Estate Law Questions