Morris Law Group has developed a trust called an Opportunity Trust™. The design of the trust provides the following benefits:

• the client is the primary trustee of the trust
• the client may control the trust’s investments and distributions to the client or others
• assets are protected from creditors of the client and the creditors of any beneficiary
• the entire trust is excluded from estate taxation for a minimum of 360 years in Florida

The trust allows the trustees to distribute any amounts of income or principal to a pool of beneficiaries composed of the client, the client’s spouse and all of the client’s descendants. It may also allow the client to add any beneficiaries in the future.

During the term of the trust, the trustees may invest in any investments they desire. The trust is a separate taxpaying entity and the beneficiaries who receive the income have it taxed at their income tax rates. This could be beneficial when paying the expenses of beneficiaries who are younger than 18 years old, as such beneficiaries’ tax rates may be lower than older beneficiaries.

One possible scenario of an Opportunity Trust™ in use is as follows: A client has the opportunity to acquire an investment that will require a contribution of $250,000. The Opportunity Trust™ obtains a $250,000 loan to purchase the investment. The Opportunity Trust™ pays market interest rates on the loan. When the investment later sells for $1,000,000, the Opportunity Trust™ pays $250,000 to the lender to pay off the loan and retains $750,000. The trustee of the Opportunity Trust™ now controls the remaining $750,000, which is protected from creditors and is outside of the estate tax system for at least 360 years.

As this technique is complex, kindly contact our office for further information and explanation.