- Nomination of Guardianship. Proper estate planning should include a clear directive nominating a successor guardian to essentially step into the parenting shoes left empty by the decedent. This formal directive is often included in a will but may also be a standalone documents. Court approval will always be a required part actual appointment of a guardian.
- Transfer to Custodian Account.
Funds can be transferred to a custodian for the benefit of a minor child. Such a transfer can occur during the donor’s lifetime or can be made by the personal representative of the donor’s estate. The Missouri Transfers to Minors Law (MTML) governs these types of transfers. The property held in a custodial account must be used by the custodian for the benefit of the minor child and the funds must be prudently invested.
- Testamentary Trust.
A testamentary trust is a trust which only comes into existence in the event that certain situational criteria are met—usually the death of both parents while the children are under a designated age, perhaps twenty-five or thirty years old. The specifics of the existence and duration of a testamentary trust are determined by the parents and detailed in the relevant provisions of the parent’s will. A testamentary trust is typically embodied in a will, in the form of a separate section of that document. It is not usually a separate agreement or document in and of itself.
- Irrevocable Trust for a Minor: Avoiding Taxation on Gifts to a Minor.
When an individual gives a gift to a minor child, they often want to create an explicit limitation or restriction on the use of those funds or property. By transferring the property/money in trust, these desires for control or direction are readily accomplished. However, if not structured properly, such a gift will not qualify for the donor’s annual exclusion from gift tax.
- Life Insurance Policy.
An adequate life insurance policy can readily provide the needed assets to provide for the ongoing needs of younger children. For younger families, a testamentary trust is very often funded primarily with the proceeds of a life insurance policy.