• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Sinclair Prosser Gasior

Annapolis Estate Planning Attorneys

  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

Call Now: (410) 573-4818

Attend a Free Workshop Trustee School

  • Home
  • About Our Firm
    • About Our Firm
    • Founding Attorneys
    • Meet Our Team
  • Services
    • Annapolis, MD Asset Protection and Business Planning
    • Estate and Gift Tax Figures
    • Annapolis, MD Elder Law & Medicaid Services
    • Annapolis, MD Trust Administration & Probate
    • Family-Owned Businesses & Farms
    • Annapolis, MD Incapacity Planning
    • Annapolis, MD LGBTQ Estate Planning
    • Annapolis, MD Pet Planning
    • SECURE Act
    • Annapolis, MD Special Needs Planning
    • Estate Planning for Young Families
  • Resources
    • DocuBank
    • Elder Law Reports
    • Estate Planning Definitions
    • Free Estate Planning Worksheet
    • Frequently Asked Questions
      • Asset Protection Planning
      • Estate Planning
      • Frequently Asked Questions for Families Without an Estate Plan
      • Legacy Wealth Planning
      • LGBTQ Estate Planning
      • Medicaid
      • Power of Attorney
      • Probate Avoidance
      • Trust Administration & Probate
      • Wills
    • Is Your Estate Plan Outdated?
    • Probate Resources
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Trust Administration
      • Estate Planning for Niches
    • Top 10 Estate Planning Techniques
    • Newsletters
  • COMMUNITIES WE SERVE
    • Anne Arundel County
      • Annapolis
      • Crownsville
      • Davidsonville
      • Highland Beach
      • Millersville
    • Baltimore County
    • Calvert County
      • Dunkirk
      • Huntingtown
      • Owings
    • Charles County
      • Charlotte Hall
      • Waldorf
    • District of Columbia
    • Howard County
    • Maryland
      • Clarksville
      • Columbia
      • Ellicott City
    • Prince George County
      • Bowie
      • Fort Washington
      • Glenn Dale
    • Queen Anne’s County
      • Grasonville
      • Queenstown
      • Stevensville
    • St. Mary’s County
      • Charlotte Hall
      • Leonardtown
  • Reviews
    • Our Reviews
    • Review Us
  • BLOG
  • Contact Us
  • Make A Payment
  • Client Portal
Home / Beneficiary Designations / Family Incentive Trust is Alternative to Disinheriting

Family Incentive Trust is Alternative to Disinheriting

October 29, 2014 by Sinclair Prosser Gasior

Colleen Sinclair Prosser, AttorneyRecent headline news reported that actor Philip Seymour Hoffman left his entire estate to his girlfriend and nothing to his three young children, therefore disinheriting them.    It is reported that he did not want to create “trust fund kids”, or kids that live off a trust and never have to earn a living for themselves.  Through Mr. Hoffman’s planning, there is no provision for financial support should his childrens’ circumstances change in the future.

If you are concerned about your children living off an inheritance they may receive from you, there are other ways to promote responsible financial lifestyles without disinheriting them.  One way is to set up a Family Incentive Trust.  This type of trust can provide for the basic needs of your family, such as health, education, maintenance and support for under age children.  Over and above basic needs for young children, a Family Incentive Trust can promote success within your family and reinforce the values that matter to you.

Communicating your trust provisions that ensure your family values to both the trustee and the beneficiaries is essential for the success of the Family Incentive Trust.  With understanding, the intentions and restrictions of the trust will be greater realized.  The trust should be presented as a reward to the beneficiaries, rather than a form of punishment or control.

The Family Incentive Trust could also provide specific instructions on how to pay for a child’s undergraduate education.  An example of this would be a stipulation that a child’s educational expenses can be paid from the trust if the child is a full-time student maintaining a certain grade point average.  Graduate studies and trade school expenses can also be provided for in the trust. If you, the Trustor, wants to promote certain types of careers such as an architect, engineer, doctor or a lawyer, then you may include specific provisions in the Family Incentive Trust on how to pay for advanced degrees.

Once the child is employed and earning a living, then the Family Incentive Trust can provide that the trust matches the income or a portion of the income of the child.  This is an effective strategy for parents who worry that their children lack a work ethic because they have grown up with money. You may want to provide incentives to children who choose careers in the public sector such as a teacher, police officer or fire fighter.  For instance, the trust could supplement the income of those beneficiaries to a greater extent.

Other examples of how a Family Incentive Trust could work would be to match whatever a child has saved toward a down payment on a home, or fund a retirement plan for a child.  If a child is caring for another family member such as a young child or an elderly parent, and is unable to work, then distributions can be made from the trust fund to provide income or pay for respite care for the child providing the care.

Promoting philanthropy may be important to you and is another way a Family Incentive Trust can be used.  If a child wants to contribute to a charitable organization, then guidelines can be laid out in the trust as to how trust funds can be used for this purpose.

You could also structure the Family Incentive Trust to act as a bank and make loans to a child under reasonable terms, or to assist the child in starting a business.  The possibilities are endless.

Disinheriting your children is a drastic measure to ensure that they become socially responsible adults.  A Family Incentive Trust can be used to promote and encourage your family values and give rewards if your children become contributing and productive members of our society.

A qualified estate planning attorney can assist you in setting up a Family Incentive Trust that carries on your family values through the generations to come.

https://spgasior.com/seminars/

  • Author
  • Recent Posts
Sinclair Prosser Gasior
Sinclair Prosser Gasior
Our firm is dedicated to providing you with quality estate planning resources, so you can become familiar with all of the existing options. When you visit or call our office, we want you to feel comfortable discussing such an important issue concerning both you and your family. We want to arm you with the information you need to make an informed decision about your family’s future.
Sinclair Prosser Gasior
Latest posts by Sinclair Prosser Gasior (see all)
  • How Often Should I Meet with an Estate Planning Attorney? - January 18, 2018
  • Tax Law Changes for 2018 - December 29, 2017
  • Dedicated Gardeners & Creative Spaces in Annapolis, MD - May 30, 2017

Filed Under: Beneficiary Designations, Business Planning, Charitible, Estate Administration, Estate Planning, Legacy Wealth Plan, Living Trusts, Planning for Minor Children Tagged With: Asset Protection, Beneficiaries, Blended Families, Charitable Contributions, Charitable Giving, estate planning, Estate Planning Attorney, Estate Planning Seminars, Family Incentive Trust, Family Wealth Trust, Inheritance Planning, Legacy Planning, Philanthropy, planning for minor children, Privacy, wpdiary.net/sinclairprosserlaw

Other Articles You May Find Useful

Annapolis trust attorney
How Can I Encourage a Beneficiary to Use an Inheritance the Right Way?
Have You Updated Your Beneficiaries Lately?
3 generation
Do You Know Who Your Designated Beneficiaries Are?
Beneficiary Designations Aren’t a True Substitute for a Trust
Sinclair Prosser Gasior
Estate Planning for Maryland Motor Vehicles
Sinclair Prosser Gasior
Why is the Titling of Assets So Important?

Primary Sidebar

Download our free estate planning worksheet

There's a lot that goes into setting up a comprehensive estate plan, but with our FREE worksheet, you'll be one step closer to getting yourself and your family on the path to a secure and happy future.
  • This field is for validation purposes and should be left unchanged.

Follow Us

  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

Testimonials

5 Stars
Client Review
September 3, 2020
    

We initiated estate planning following a presentation by Sinclair Prosser Attorney Jon Gasior. We were so impressed, we contracted with them to complete our estate planning. Subsequently, we assembled information on our assets and Sinclair Prosser Gasior did the rest. Correspondence was communicated to our financial institutions and the estate was established. We were very pleased with the courteous manner of the Sinclair Prosser Gasior staff. However, it was their professionalism that made us satisfied we chose this firm to handle our estate. We have nothing but praise for Sinclair Prosser Gasior .

default image
– Walter K.

Blog Subscription

Sign up for our blog to receive all of our latest estate planning news and updates!
  • This field is for validation purposes and should be left unchanged.

ANNAPOLIS

900 Bestgate Road
Suite 103, Annapolis, Maryland 21401
Phone: (410) 573-4818
Fax: (410) 573-2802

BOWIE

4201 Mitchellville Road
Suite 403, Bowie, MD 20716
Phone: (301) 970-8080
Fax: (410) 573-2802

MILLERSVILLE

1520 Jabez Run Rd
Suite 300, Millersville, Maryland 21108
Phone: (410) 573-4818
Fax: (410) 573-2802

WALDORF

Hamilton Centre II
3261 Old Washington Road, Suite 2020 Waldorf, MD 20602
Phone: 800-366-4615

Map

map for office

Footer

footer logo
  • Facebook
  • LinkedIn
  • Twitter
  • YouTube

The information on this Maryland Attorneys & Lawyers / Law Firm website is for general information purposes only. Nothing on this or associated pages, documents, comments, answers, emails, or other communications should be taken as legal advice for any individual case or situation. This information on this website is not intended to create, and receipt or viewing of this information does not constitute, an attorney-client relationship.

© 2023 American Academy of Estate Planning Attorneys| Privacy Policy | Contact Us | Disclaimer | Site Map