The Castle Trust was created to offer the best of both worlds, the flexibility of the revocable trust with the asset protection nature of an irrevocable trust. It came out of the need clients had for protection against long-term care and is based on the legal technologies lawyers have used for decades to protect against the dreaded inheritance tax. By stripping away the restrictions around estate tax planning, the Castle Trust is a flexible asset protection trust that protect against lawsuits and long-term care costs, without sacrificing control and flexibility.
Assets held in a Castle Trust are owned by the trust; therefore, trust assets cannot be titled in joint tenancy or given to your spouse. This prevents separate property from becoming marital property, subject to equitable division by a divorce-court judge.
Assets held in a Castle Trust can prevent diversion of family assets to persons outside the family bloodline, a major concern for parents who fear that a child’s inheritance may later trickle down to the bank account of a less-than-perfect son-in- law or daughter-in-law (and his or her new spouse) instead of to the grandchildren! Assets remaining in your trust at your death will pass automatically to your children and children’s children.
Assets held in a Castle Trust cannot be seized or attached by successful plaintiffs in litigation, including accident cases, sexual harassment suits, etc. Since assets held in a Castle Trust are not legally owned by the trust maker, they are not "available" to satisfy a court judgment.
Assets held in a Castle Trust cannot be claimed by your creditors. Even if you were forced to file for personal bankruptcy, assets held in the Castle Trust would be sheltered from loss.
MEDICAID AND MEDICAL EXPENSE PROTECTION
Assets held in a Castle Trust enjoy protection from Medicaid and nursing home spend-down. Nursing homes in Michigan cost between $8,000-$12,000 per month. The Castle Trust starts the five-year clock ticking for Medicaid, where if the trust maker can make it five years from the time the trust is funded, 100% of the assets in the trust will be protected. With new legislation making it more difficult to qualify for Medicaid benefits at the last minute, asset-protection planning is more important now than ever.
PROTECTION FOR CHILDREN AND BEYOND
Assets held in a Castle Trust can benefit your children by preserving assets in the family bloodline against a child's divorce, bad habits, legal problems, death taxes, premature death, and debt problems. After a child's death, these same protections can be continued for the benefit of your grandchildren and their children by the continuous operation of the Castle Trust for generations to come.
WHO CAN SERVE AS A TRUSTEE OF A CASTLE TRUST?
You or you and your spouse serve as trustee of the trust. You have full control to manage the assets in the trust. You can buy or sell assets, all within the protections of the trust. If you wanted to sell your house and purchase another house, you can do it within the Castle Trust.
The Castle Trust is the most powerful asset-protection tool for those concerned about long-term care costs and lawsuits in American law. It provides for you, your children and younger generations in a manner that reflects your family values and personal concerns. For decades, wealthy families have successfully shielded family wealth. Faced with the reality of $8,000-$12,000 per month nursing home bills, 50%+ divorce rates, record-setting bankruptcy filings, and 24 million new lawsuits a year, it is no mystery why prudent families – regardless of net worth – are turning to the Castle Trust to protect family wealth for generations.
To get started on creating a Castle Trust with a Michigan estate planning or Certified Elder Law Attorney, contact our office at 844-885-4200. The team at Castle Wealth Group Legal is here to help.