Chesapeake Irrevocable Trust Lawyer
Trusts are a very important part of estate planning. People use revocable trusts in most cases, but irrevocable trusts have many benefits, as well. Revocable trusts can be amended or revoked by the creator with few exceptions. Irrevocable trusts have stricter guidelines, but they also have different protections for anyone planning their estate. Below, our Chesapeake irrevocable trusts lawyer explains more about these legal tools and the benefits they offer.
What Does an Irrevocable Trust Do?
Except in very limited circumstances, irrevocable trusts cannot be revoked or modified by the grantor, the person who created the trust. The grantor appoints one or more trustees to manage the property within the trust for the benefit of the beneficiaries of the trust. The beneficiaries are the people or organizations that will eventually receive the property in the trust.
Irrevocable trusts are created to protect certain property for beneficiaries. Once the trust has been created, the grantor then funds it by placing property into it. After assets are placed into the trust, they become the property of the trust and the grantor removes their legal right to the trust. The trustee then manages the assets within a trust. Life insurance policies, cash, business investment assets, and real estate are some of the most common assets placed into irrevocable trusts.
The Benefits of Irrevocable Trusts
Revocable trusts are more flexible because they allow the grantor to continue managing the assets within a trust during their lifetime. Due to the fact that an irrevocable trust essentially legally changes ownership, the assets within a trust are not subject to the probate process after the grantor’s death. Beneficiaries can then avoid the cost and time-consuming process. Grantors are also not personally liable for estate taxes on the property held in the trust.
An irrevocable trust can also provide a great deal of protection from creditors. Whether creditors are trying to obtain compensation from the grantor or the beneficiaries, they do not have access to the property within an irrevocable trust. Other benefits of irrevocable trusts are as follows:
- Remove taxable property from the estate
- By setting conditions for distribution, you can prevent beneficiaries from missing the assets in the trust
- Gifting assets, such as a rental property, to the estate while keeping income from those assets
- Gift a primary residence to a child under better tax guidelines
- Minimizing property to obtain public benefits, including Medicaid for long-term care in a nursing home or for a child with special needs
Call Our Irrevocable Trust Lawyer in Chesapeake for Legal Advice
Irrevocable trusts do have many benefits but because they cannot be changed, it is critical that you obtain legal advice when establishing one. At The Law Office of Angela N. Manz, our Chesapeake irrevocable trust lawyer can advise on the type of trust that may be best for you, and help you develop an effective estate planning strategy. When you need sound legal advice, call us at 757-271-6275 or contact us online to schedule a consultation and to get more information.
