Jack's daughter has creditors seeking money from her, over $70,000 is owed by his daughter. He is currently creating a will, what provision would Jack be wise to include?

Question

Quizplus · Accepted Answer

To prevent creditors from gaining inherited funds from a will, a spendthrift clause would be placed within will. It is designed to protect trust assets from the "spendthrift" propensities of a trust's beneficiary. A trust provision may prohibit a trust beneficiary from assigning his or her interest in the trust corpus. Such a provision will prevent creditors from reaching the trust assets by any legal or equitable process. However, once trust income is paid to the beneficiary, the funds lose their trust character and may be attached by creditors.

Jack's Daughter Has Creditors Seeking Money from Her, Over $70,000