What Is an Irrevocable Living Trust?

You may have heard of a Last Will and Testament as being the most important estate documents to incorporate into your plan. However, depending on your specific financial circumstances, you may want to take your estate plan one step further by establishing an irrevocable living trust. Read on to discover the functions of an irrevocable living trust and how one of the seasoned Butler County trust attorneys at Heritage Elder Law & Estate Planning, LLC can help you determine whether a revocable living trust is more suitable.

What are the functions of an irrevocable living trust?

Put in its simplest terms, an irrevocable living trust functions as a means of asset protection. That is, this has you (i.e., the grantor) transfer your ownership rights over your assets to that of the trust. This is so you may reduce the value of your taxable estate. In turn, you may protect your assets from being taken by legal judgments and creditors, among other third parties.

Within the terms and conditions of this trust type, you may still control who has authority over this trust should you become incapacitated (i.e., the trustee); who has the right to inherit these assets should you pass on (i.e., the beneficiaries); and when and how these assets should be distributed upon your passing. Ultimately, a drawback you must accept is that, once you place your assets into this trust type, you cannot modify, amend, or terminate it without the permission of your beneficiaries.

What advantages might a revocable living trust have?

An irrevocable living trust comes with advantages far greater than mentioned above. But at the end of the day, you must understand that this trust type is not for everyone. In other words, you may find your estate is better suited for a revocable living trust. The key difference between the two is that an irrevocable living trust is permanent throughout your lifetime and after your passing while a revocable living trust only becomes permanent after your passing. Without further ado, a revocable living trust may have the following advantages over an irrevocable living trust:

• A revocable living trust may be more advantageous if you anticipate your financial situation to fluctuate significantly in the coming years.
• A revocable living trust may be more advantageous if you are not yet confident in what you wish the terms of your plan to be.
• A revocable living trust may be more advantageous if you wish for an estate planning document that is easier to set up.
• A revocable living trust may be more advantageous if you prefer to work as your own trustee.

When in doubt, someone at Heritage Elder Law & Estate Planning, LLC will look into your case. So please retain the legal services of one of the competent Butler County estate planning & probate attorneys today.