SimplyTrust Knowledge Base

A: There are many benefits of trusts for small business. Continuity: A trust helps prevent business disruption when ownership changes hands. Avoiding Probate: Trust assets typically bypass the probate process, speeding up access for successors. Privacy: Trusts are private documents—unlike wills, they don’t become public during probate. Tax Planning and Liability Protection: In some cases, certain types of trusts may offer tax benefits or shield business assets from personal liabilities.

A: Funding a trust means putting assets into the trust. However, funding isn't the best option for all assets—for some assets, naming the trust as a beneficiary is a better way to go. Those assets include: retirement accounts, life insurance policies, Health Savings Accounts (HSAs), vehicles, and everyday checking accounts.

A: Yes, and right after finalizing the divorce is the best time. But if not right after, then anytime after still works—it’s never too late. Just as long as you do it. Making those changes now can avoid problems later.

A: Generally, you shouldn’t transfer ownership of your life insurance policy into your trust unless you have a specific reason (like tax planning in very large estates). However, you can name your trust as the beneficiary of the life insurance policy, thereby ensuring that the benefits go where you want them to.

A: A simple trust is a type of trust that must distribute all its income to the beneficiaries each year. It can’t make charitable donations, and it can’t dip into the trust principal (the original assets placed into the trust) for distributions.