Dynasty Trusts: Sharing Your Wealth with Future Generations

Over the years, George and Marla had built a real estate empire. Now, their deepest desire was to make sure their children and future descendants benefitted from their work. While discussing their estate planning goals with their lawyer, they learned about dynasty trusts. If sharing your wealth with future generations is a consideration, you, too, might benefit from a dynasty trust.

Building an Enduring Legacy with Dynasty Trusts

Some families pass most of their wealth on to their children as a form of legacy building. Once the inheritance has been distributed, there are no controls on how the inheritance may be used. Unfortunately, some heirs are simply not well-equipped to handle an inheritance and lose everything in ill-conceived business deals, gambling, or overspending.

Dynasty trusts do a better job of protecting a family’s wealth:

  • The grantor or grantors establish the dynasty trust, which is an irrevocable trust.
  • The intention is that the trust assets continue to be owned and managed by the trust as long as the law allows.
  • In Florida, a dynasty trust may last the lifetime of a specific beneficiary plus up to 360 years.
  • The trust could include language, like a power of appointment, that addresses the need to make some changes to the trust at some point.
  • Dynasty trusts can offer asset protection for future beneficiaries since they never own the trust assets.

Theoretically, George and Marla’s descendants could still be enjoying their bounty for hundreds of years after George and Marla have passed on.

Sharing Your Wealth While Reducing the Tax Burden

It’s heartwarming to think that your wealth can help your future descendants. But reducing taxes is one of the major reasons to consider a dynasty trust:

  • Gift tax may be paid when assets are transferred to the trust. Even then, the tax is only due if the value of the assets exceeds federal tax exemptions.
  • Assets transferred to the trust typically decrease the value of the grantor’s taxable estate.
  • Beneficiaries may receive income from the trust, but the trust assets do not become part of the beneficiaries’’ taxable estate.

Will a Dynasty Trust Make a Difference to Your Family’s Future?

A well-planned dynasty trust provides a thoughtful way to care for future generations while minimizing taxes. Interested in dynasty trusts?  As always, talk to an experienced attorney before establishing any trust.

At Law Offices of John Mangan, P.A., we help clients choose strategies that meet their needs. Please contact us at 772-324-9050 to schedule an appointment or fill out our Contact Form. We are located in Palm City, Florida, and serve clients in surrounding communities like Stuart, Hobe Sound, Port St. Lucie, and Jupiter, too.

Written by John Mangan, Esq.

John Mangan, Esq.

I’m an attorney in Palm City, FL, and I serve clients throughout Martin County, including Stuart, Palm City, Hobe Sound, and Indiantown, as well as those in St. Lucie County, the Treasure Coast, Palm Beach County, and other parts of Florida. The Law Offices of John Mangan, P.A., is an innovative firm providing estate planning services to clients in Florida. We focus primarily on wills, trusts, asset protection, guardianship, and probate administration.