Best Trusts Lawyers in Tennessee

About Trusts Law in Tennessee, United States

A trust is a legal arrangement that allows a person, known as the grantor or settlor, to transfer assets to a trustee. The trustee manages these assets for the benefit of beneficiaries specified in the trust document. In Tennessee, trusts are a popular estate planning tool, offering individuals and families greater control over how their property is managed and distributed. Trusts can provide privacy, help avoid probate, and offer asset protection. Tennessee has enacted comprehensive trust laws that govern the creation, management, and termination of trusts to ensure they are used effectively and ethically.

Why You May Need a Lawyer

There are several common situations where seeking a lawyer's assistance with trusts in Tennessee is beneficial. If you are setting up a trust to pass on wealth, care for a minor or a disabled family member, reduce estate taxes, or avoid probate, a lawyer can help you choose the right type of trust and draft the necessary documents. If you are a trustee, a lawyer can help you understand your duties and responsibilities to prevent any unintentional breaches of fiduciary duty. Beneficiaries who believe a trust is being mishandled may also need legal representation. Additionally, trust disputes, modifications, or terminations often require legal advice to navigate successfully.

Local Laws Overview

Tennessee has adopted the Uniform Trust Code, which modernizes and standardizes trust laws statewide. Some key aspects include allowing for both revocable and irrevocable trusts, flexible modification and termination processes, and the use of directed trusts where an investment advisor may direct a trustee on asset management. Tennessee also offers favorable laws for asset protection trusts called Tennessee Investment Services Trusts, which shield assets from creditors under certain conditions. Additionally, Tennessee law outlines specific duties for trustees and legal protections for beneficiaries. It is important to note that specific formalities, such as written trust agreements and proper execution, must be followed for a trust to be legally valid.

Frequently Asked Questions

What is the difference between a revocable and irrevocable trust?

A revocable trust can be changed or canceled by the grantor during their lifetime, while an irrevocable trust generally cannot be changed once it is created. Irrevocable trusts often offer greater asset protection and tax benefits.

Why should I set up a trust instead of just making a will?

A trust can help bypass the probate process, allow for more privacy, provide ongoing management for minors or those with special needs, and may offer asset protection that a will cannot.

Do I need a lawyer to create a trust in Tennessee?

While it is not legally required, hiring a lawyer ensures that your trust is set up correctly, complies with Tennessee law, and achieves your specific goals.

Can a trust protect my assets from creditors?

Certain types of trusts in Tennessee, such as Tennessee Investment Services Trusts, may offer protection from creditors, but specific rules and requirements must be met.

How do I choose a trustee?

A trustee should be someone trustworthy, organized, and capable of managing finances. Many people choose a reliable family member, friend, or a professional fiduciary or bank.

Can I change the beneficiaries of my trust?

If your trust is revocable, you can change beneficiaries during your lifetime. Irrevocable trusts generally cannot have beneficiaries changed, though there may be exceptions in some cases.

What happens to my trust after I die?

After your death, the trust becomes irrevocable (if it was not already) and the trustee distributes or manages the assets according to the terms set in the trust document.

Are trusts taxed in Tennessee?

Tennessee does not levy a state inheritance or estate tax, but trust income may be subject to federal taxes. Some trusts may face specific tax consequences, so consulting a lawyer or tax advisor is recommended.

Can a trust be contested?

Yes, trusts can be challenged in court for reasons such as undue influence, lack of capacity, or improper execution. Contesting a trust is complex and legal representation is highly advised.

Is a living trust public record in Tennessee?

No, living trusts are private documents and generally do not become public record, unlike wills that go through probate court.

Additional Resources

Several organizations and government bodies can provide helpful information and support regarding trusts in Tennessee:

• Tennessee Department of Commerce and Insurance
• Tennessee Bar Association
• Legal Aid Society of Middle Tennessee and the Cumberlands
• Local probate and chancery courts
• Certified estate planning attorneys and financial advisors

Next Steps

If you think a trust may be right for your situation or if you are already a trustee or beneficiary encountering a legal issue, consider reaching out to a qualified estate planning or trust attorney in Tennessee. Prepare a list of your assets, your goals for asset distribution, and any specific concerns or questions you may have. Schedule a consultation to discuss your options, clarify complex issues, and ensure your interests are protected. Taking these steps will help you make informed decisions and secure your financial future and that of your loved ones.