When it comes to planning for the future, the peace of mind that comes from knowing your loved ones will be financially secure is priceless. At Peach State Wills & Trusts, a division of The Beck Law Firm, LLC, we believe every Georgia family deserves an estate plan tailored to their unique needs.

One often overlooked tool for maximizing the value of an estate is the unitrust. Let's explore how this flexible estate planning option can work for you and your loved ones.

Why Consider a Unitrust?

A unitrust is an irrevocable trust designed to provide steady income to beneficiaries while preserving the remaining assets for future generations or charitable purposes. What makes a unitrust stand out in estate planning is its ability to balance the needs of both current and future beneficiaries.

In Georgia, unitrusts distribute a fixed percentage—typically around 4% of the trust's total value to beneficiaries annually. This structure offers predictability and the potential for growth, making it a smart choice for families looking to secure their financial future.

How Do Unitrusts Work in Georgia?

Understanding the mechanics of a unitrust is key to seeing how it could fit into your estate plan. Here's how it all comes together:

Setting Up the Trust

The grantor (that's you) transfers assets into the trust. This might include cash, real estate, stocks, or other valuable property.

Trustee's Role

A trustee, often a trusted individual or professional, manages the trust. They're responsible for investing the assets and ensuring the income is distributed according to the trust terms.

Distribution Rules

Each year, the trustee determines the trust's net fair market value. A predetermined percentage—let's say 4%—is applied to this value to calculate the beneficiaries' annual distribution amount.

Example in Action

Imagine a trust valued at $750,000 with a 4% distribution rate. Beneficiaries would receive $30,000 that year. The trust is revalued the next year, and the distribution adjusts accordingly.

Benefits of a Unitrust for Your Estate Plan

Choosing a unitrust offers several advantages for Georgia families, particularly those with diverse financial goals.

Predictable Income for Beneficiaries

A steady income stream can make all the difference in times of economic uncertainty. Beneficiaries can rely on consistent payments, which provide financial stability.

Asset Protection

Because a unitrust is irrevocable, the assets within it are shielded from creditors and legal claims, offering added protection for your legacy.

Balanced Benefits

Unitrusts are uniquely designed to balance the needs of current and future beneficiaries. The fixed-percentage distribution ensures fairness and prevents over-depletion of trust assets for the initial beneficiaries. 

Investment Flexibility

Trustees have the freedom to pursue investment strategies that align with the trust's goals. This flexibility often results in both income and asset growth, further enhancing the trust's value.

Tax Advantages

Certain types of unitrusts, like charitable remainder unitrusts (CRUTs), may offer tax benefits. These can include reduced estate taxes and income tax deductions for charitable contributions under Georgia law.

Types of Unitrusts in Georgia

Georgia allows for several types of unitrusts, each tailored to different goals:

Charitable Remainder Unitrusts (CRUTs)

Charitable remainder trusts provide income to beneficiaries for a specified period, with the remainder of the trust's assets going to a designated charity. CRUTs are a popular option for those looking to leave a philanthropic legacy.

Grantor Retained Annuity Trusts (GRATs)

Grantor Retained Annuity Trusts are designed to transfer assets to beneficiaries while minimizing gift taxes. They're often used for larger estates with significant financial holdings.

Personal Unitrusts

These trusts can address specific family needs, such as providing for a loved one with a disability, all while complying with Georgia's trust laws.

Is a Unitrust Right for Your Estate Plan?

Unitrusts aren't one-size-fits-all. Whether a unitrust is the right choice for your family depends on several factors:

●  Your financial goals and the needs of your beneficiaries.

●  The size and type of assets you plan to include in the trust.

●  How much control you'd like to maintain over distributions.

●  The potential tax implications under Georgia law.

At Peach State Wills & Trusts, we work closely with our clients to evaluate their options and craft a plan that aligns with their values and objectives.

Plan for Your Future with Peach State Wills & Trusts

Estate planning is more than just a legal process—providing peace of mind and security for the people who matter most to you. A unitrust may be the solution you've been looking for to ensure your family's financial future.

Let's discuss how Peach State Wills & Trusts can help. Call us at 678-344-5342 or fill out our online contact form to schedule a consultation. We can create a plan that gives you confidence in what's ahead.

If you have any other questions about estate planning in Georgia, you can download our free guide, no strings attached.