Revocable or Irrevocable Trust?
That is the Question
Often, the most important decision one must make in designing an effective estate plan is choosing between a Revocable and an Irrevocable Trust Agreement.
– A revocable trust has the advantage of flexibility in allowing the creator of the trust, known as the Grantor, to easily change or revoke its terms. This type of trust accomplishes three primary goals:
1.) allows for continued management and use of all trust funds by the grantor- who is typically also the trustee of the trust- during the grantor’s lifetime.
2.) avoids probate upon the death of the grantor as would occur if a Will was used for estate distribution; and,
3.) allows for privacy, as the trust is a private document to be shared only with beneficiaries, whereas a Will, once probated, becomes public and may be accessed by almost anyone.
– An irrevocable trust accomplishes all the above three goals, but may also accomplish these additional estate planning goals:
1.) shield the grantor’s assets from creditors.
2.) provide substantial tax benefits to the grantor and others named in the trust.
3.) allow for new or continued government benefits, such as Social Security payments or Medicaid long-term care, to flow to the grantor.
An irrevocable trust may provide these added benefits precisely because it is irrevocable and therefore may not be changed or revoked by the grantor, except under extraordinary circumstances.
To discover which trust is most appropriate for your estate planning needs, kindly schedule a no-cost consultation with the Law Office of Evan Benjamin at your earliest convenience.
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