Houser Firm

5 trusts that can help preserve wealth in Texas

On Behalf of | Jan 28, 2025 | Estate Planning

In Texas, the rugged land of opportunity, there is more to wealth preservation than cattle and oil. For those keen on safeguarding their assets for future generations, trusts can offer a savvy and strategic approach.

Below we explore four types of trusts that Texans can utilize to fortify their wealth preservation strategy.

Charitable remainder trust (CRT)

A CRT supports philanthropic goals while providing income to you or other beneficiaries during your lifetime. Afterward, the remaining assets benefit your chosen charities, reducing estate taxes and leaving a lasting legacy.

Grantor retained annuity trust (GRAT)

With a GRAT, you can transfer assets while retaining the right to receive regular annuity payments for a set period. The remaining assets pass to beneficiaries, potentially with tax advantages.

Dynasty trust

A dynasty trust is designed to keep wealth in the family for generations to come. It can shield assets from estate taxes for up to 300 years, ensuring your hard-earned wealth remains in the hands of your descendants.

Irrevocable life insurance trust (ILIT)

An ILIT removes the death benefit from your estate, reducing estate taxes and providing liquidity for your heirs. It helps to ensure your life insurance policy benefits are maximized and used wisely.

Qualified personal residence trust (QPRT)

A QPRT allows you to transfer your residence to beneficiaries at a reduced gift tax cost while allowing you to live there for a specified period. This reduces the taxable value of your estate and keeps your home in the family.

Whether wrangling with estate taxes or planning for future generations, these trusts are worth considering for your wealth preservation strategy. Having professional estate planning guidance can help you determine which one(s) work best for you and your family.