Our trust lawyers can help you create an alter ego trust or a joint partner trust. Independent advice is also provided by a tax lawyer as part of the cost to ensure that the trust is the most tax efficient and beneficial to you.
Both alter ego and joint partner trusts are “inter vivos” trusts, meaning you transfer your assets into the trust during your lifetime. After it is set up, you would have assets in the trust (which at your death would pass according to the trust document), and assets still held by you personally (which at your death would pass to those named in your will, or otherwise by joint ownership or beneficiary designation). Both of these trusts have basically the same concept, benefits and drawbacks. The difference is that an alter ego trust is for one person, whereas a joint partner trust is for married or common law couples.
To be able to qualify for one of these trusts, you must:
- Be 65 or older
- be entitled to receive all of the income from the trust
- be the only person (or people for spouses) entitled to receive or have use of the income or capital of the trust
Also, Westcoast Wills & Estates tends to recommend these trusts only to those with an estate worth over roughly $2 million, if the sole reason for setting up the trust is to avoid probate (the probate fee on $2 million is roughly $28,000).
- No probate fee on the assets in the trust (in BC, the probate fee is roughly 1.4% of the total value of your assets)
- No probate process for the assets held in trust (the probate process can often take well over a year)
- Privacy (no third party will know what assets are in the trust, whereas probate filings are public)
- Some usefulness for disinheritance situations (discuss this with our trust lawyers, as care must be taken)
- Added complexity to your life
- The trust may need to file annual tax returns
- More expensive than a will to set up (although the savings of probate fees more than justify this expense in the long-run)
If you are unsure if setting up this type of trust is right for you, the experienced wills and trust lawyers at Westcoast Wills & Estates can answer all of your questions and provide you with advice to help you decide. These trusts are usually complimented by basic Wills, Powers of Attorney and Representation Agreements