Can I add a clause in a will like this, "not to be used for debts"?

[geoffois]

What is the name of your state (only U.S. law)? California

I found a will online and my dad thought it was fine for his purposes. I thought I read somewhere that a will can have a clause to protect the beneficiary from losing the inheritance if there is prior lawsuits or liens or maybe it was judgments. Is there any language that a will can have to protect the beneficiary from having anyone go after the inheritance?

Ok I found it is a "Beneficiary Trust". I'm reading more about it and will see if it something that can be written into the will. If the will can transfer it's benefits into the trust upon death that would be good or maybe it needs to be created prior to the execution of a will.

 

[tranquility]

While certain trusts which are written in a certain way can have a certain protection of some of the assets, you can't generally protect the amounts distributed (Or, which could be distributed according to the trust's terms.) to the beneficiary.

It is far more complex then adding some magic words to the trust-creating document.

 

[xylene]

Truly, I think that you need an expert legal consult to try and untangle what you want and wish to accomplish and how to set up your estate to do that.

Bluntly, are you very aged or close to death due to illness? How much of these debts you which to block can you forsee or are aware of?

Are you looking to protect a specific beneficiary from known present circumstances or is this a quasi-hypothetical like a beneficiary who you know has a checkered financial past and is likely to have financial problems on your passing and/or you aren't sure what issues they have...?

Also, allow me to ask plainly, if a beneficiary has many debts and your bequest relieves them of some or all of that burden, why do you not see that as a fitting final gift?

Are you looking to punish a beneficiary who has made personal or financial decisions you do not approve of?

If that is your goal, that is ok, just be clear with the lawyer you hire what you want so it is set up right.

 

[geoffois]

Yes, I know exactly what you mean tranquility. From what it seems, the beneficiary trust is something that is created before one passes and in some states the trustee needs to be not the beneficiary for it to be truly effective. All the articles I read so far say it will effectively protect the assets from even being taxed a second time if the beneficiary leaves the trust to his heirs. My dad wanted me to make a basic will for him, but since I am being sued and will most likely file for bankruptcy it probably won't be a problem years from now. However, just incase he wanted me to look into some legal device that would protect the assets from creditors upon his death. I have the articles that discuss it, but I can't remember if the rules allow me to post other websites here. It does look like a an expert would need to draft up this type of trust.

 

[justalayman]

the trust does not protect your payments from the trust from being attached by the creditor. If the creditor attaches your trust benefits, you would simply be slowly paying your debt using the money in the trust or earnings on that money.

 

[geoffois]

the trust does not protect your payments from the trust from being attached by the creditor. If the creditor attaches your trust benefits, you would simply be slowly paying your debt using the money in the trust or earnings on that money.

Ic. From what the article seemed to say that is totally different. It specifically said if you have a trustee who actually decided what gets paid then it is protected. There would be no automatic payments so maybe that is different than what you are thinking in terms of a regular trust. It even stated that if done correctly that a beneficiary wouldn't even have it hurt the possibility of financial aid. I'll post the article and hopefully it is ok to do so. It might be flat out full of lies, so maybe you can see.

The beneficiary trust - The Estate Plan - on ProducersWEB.com

Protect Your Beneficiary's Inheritance

 

[anteater]

This is not a do it yourself project. Grabbing a bunch of articles off the internet will not cut it. You, yourself, said:

It does look like a an expert would need to draft up this type of trust.

 

[justalayman]

Ic. From what the article seemed to say that is totally different. It specifically said if you have a trustee who actually decided what gets paid then it is protected. ]

If you have money in your pocket or bank account that came from the trust, there is no special protection for that money. If the trustee makes payments specifically to some entity other than you, you don't have the cash in your possession. That is a different situation than I was speaking of. Payments to you are payments to you. What you are speaking of are payments made from the trust for or on behalf of you. Two entirely different things.

and yes, due to the variety of types of trusts and all the laws that deal with each of them, you do not individual and specific advice from a professional.

 

[geoffois]

This is not a do it yourself project. Grabbing a bunch of articles off the internet will not cut it. You, yourself, said:

Yes, that's why I don't plan on doing anything myself. the articles were only for information. Lawyer would need to actually set it up, but thanks for pointing out that the articles won't create a "beneficiary trust"

Thanks justalayman, yes I do understand fund in personal bank accounts and such are up for grabs. It seems this type of trust is secure from creditors since it is held apart from myself. I will consult with a professional. Thanks for your input.

 

[latigo]

Just bear in mind that in any protected or spendthrift trust, be it testamentary or otherwise, the beneficiary’s creditors or a Trustee in bankruptcy can access any assets held in that trust that are then available to the beneficiary.