Living Trust In Colombia

Why Should I have a Living Trust in Colombia? Most importantly the assets placed into a Colombian trust cannot be forced into liquidation in divorces, taxes, or law suits. Trusts also represent an excellent way to reduce taxes for inheritance passed to children or your spouse. A Living Trust in Colombia is used to protect your home, property, bank accounts, shares in a Colombian company, business establishment, vehicles, pets, jewelry, valuables, and other assets.

Colombia Legal Alert: Couples enter into a common law marriage in just 2 years! Spouses can have rights to percentages as high as 50% on property purchases or profits from rentals and sales which happen during a relationship.

A living trust (Fideicomiso Civil in Spanish) is a legal document created by a licensed attorney in Colombia through which your assets are placed into a trust for your benefit during your lifetime, and then transferred to designated beneficiaries at your death or if you become incapacitated. An administrator (trustee) may take control of the assets upon your death, or the beneficiary may also directly receive assets upon death. When children are involved its best to have an administrator oversee the trust for a set period.

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What is a living trust and how is it different from a last will and testament?

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Avoid Probate, and Inheritance Taxes – It’s a smart way to avoid probate. Keep more money in the family by avoiding potentially lengthy and expensive court proceedings. A will and testament in Colombia is important to keep your wishes clear to cover any items which are not in a trust.

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Protects Family Assets – Your affairs get handled if you’re incapacitated. Avoid going to court by appointing a trustee to take charge of your finances according to your instructions. While you are a live and mentally Capable you maintain complete control of the trust.

Estate Planning – A plan for your family’s future – You set conditions now on how property or money maybe used if something happens to you. Excellent to force financial management of assets for the family if you die, become incapacitated or unable to sign documents. Minors futures are protected. A popular condition for a trust is to block property sales until a child finishes high school or college. Trusts may also be setup to protect mentally dependent adults. The bottom line is that your family is protected from lengthy and costly processes.

Can I transfer property into and out of the trust while I’m alive? Yes. If you have an individual trust, you can transfer property whenever you want. If you have a shared trust, you’ll need your co-trustee’s consent if you own the property together.

Aren’t living trusts just for the wealthy? Not at all. People of all income levels can set one up to manage their finances in case they become disabled, or to provide for loved ones without going through probate court, which may be required of relatively modest estates.

Do I still need a will in Colombia if I have a living trust? Yes, because you may not have transferred your property into your trust before you pass away. It transfers property still in your name alone when you pass away to the trust to be distributed to your beneficiaries. It also lets you name guardians for your minor children. Click here for more information on a will in Colombia.