There are benefits and drawbacks of using trusts versus outright gifts when passing assets to your children or grandchildren.

Q: We are considering passing some of our liquid assets in trust to our offspring. What are the pros and cons of forming trusts versus outright gifts?

A: There are many advantages to leaving property in irrevocable trusts for your children and grandchildren.

Trust property is generally protected from the claims of creditors, including spouses in the event of divorce. Exceptions include unpaid child support or unpaid taxes, but having the inheritance in a trust would be far more protected than owning the property outright.

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It is also possible for trusts to be written so that when your children........

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