Trusts
Revocable And Irrevocable Trusts
Revocable Trust
A revocable trust, also known as a living trust, is a legal document that allows the creator of the trust (the “settlor” or “grantor”) to change or revoke the trust at any time. The grantor retains control of the trust's assets and can make changes such as adding or removing beneficiaries, or changing terms.
Revocable trusts are used for a variety of reasons, including:
- Avoiding probate. A revocable trust can help you avoid the often costly and time-consuming probate process. Additionally, where probate is a public process, use of a revocable trust can help keep a family's assets and privacy intact.
- Managing property. Successor trustees designated in a revocable trust can manage property if the grantor becomes incapacitated.
- Distributing assets. A revocable trust can help distribute assets to beneficiaries after the grantor's death.
However, revocable trusts have some downsides, including:
- No protection from creditors. Assets in a revocable trust are not protected from creditors.
- Limited tax benefits. Assets in a revocable trust are not exempt from estate tax.
- Maintenance. Revocable trusts often require more maintenance than a will.
It's important to consider your particular circumstances and goals when deciding whether a revocable trust is right for you. You can set up a consultation with us and we will help you find the best options for your situation.
Schedule a free consultation today to discuss your personal estate planning needs.
Revocable Trust
A revocable trust, also known as a living trust, is a legal document that allows the creator of the trust (the “settlor” or “grantor”) to change or revoke the trust at any time. The grantor retains control of the trust's assets and can make changes such as adding or removing beneficiaries, or changing terms.
Revocable trusts are used for a variety of reasons, including:
- Avoiding probate. A revocable trust can help you avoid the often costly and time-consuming probate process. Additionally, where probate is a public process, use of a revocable trust can help keep a family's assets and privacy intact.
- Managing property. Successor trustees designated in a revocable trust can manage property if the grantor becomes incapacitated.
- Distributing assets. A revocable trust can help distribute assets to beneficiaries after the grantor's death.
However, revocable trusts have some downsides, including:
- No protection from creditors. Assets in a revocable trust are not protected from creditors.
- Limited tax benefits. Assets in a revocable trust are not exempt from estate tax.
- Maintenance. Revocable trusts often require more maintenance than a will.
It's important to consider your particular circumstances and goals when deciding whether a revocable trust is right for you. You can set up a consultation with us and we will help you find the best options for your situation.
Schedule a free consultation today to discuss your personal estate planning needs.
Revocable Trust
A revocable trust, also known as a living trust, is a legal document that allows the creator of the trust (the “settlor” or “grantor”) to change or revoke the trust at any time. The grantor retains control of the trust's assets and can make changes such as adding or removing beneficiaries, or changing terms.
Revocable trusts are used for a variety of reasons, including:
- Avoiding probate. A revocable trust can help you avoid the often costly and time-consuming probate process. Additionally, where probate is a public process, use of a revocable trust can help keep a family's assets and privacy intact.
- Managing property. Successor trustees designated in a revocable trust can manage property if the grantor becomes incapacitated.
- Distributing assets. A revocable trust can help distribute assets to beneficiaries after the grantor's death.
However, revocable trusts have some downsides, including:
- No protection from creditors. Assets in a revocable trust are not protected from creditors.
- Limited tax benefits. Assets in a revocable trust are not exempt from estate tax.
- Maintenance. Revocable trusts often require more maintenance than a will.
It's important to consider your particular circumstances and goals when deciding whether a revocable trust is right for you. You can set up a consultation with us and we will help you find the best options for your situation.
Schedule a free consultation today to discuss your personal estate planning needs.
Irrevocable Trusts
An irrevocable trust is a legal arrangement that cannot be changed or ended by the person who creates it (the “settlor” or “grantor”). The grantor transfers assets to a trustee who manages the trust, and the terms of the trust become legally binding.
Irrevocable trusts are often used for estate planning and asset protection. Some benefits of irrevocable trusts include:
- Tax benefits. Assets in an irrevocable trust are not included in the grantor's taxable estate, which can reduce the grantor's tax liability (and is particularly pertinent in Washinton where the individual estate tax threshold remains $2.193 Million). For example, if you are a Seattle resident who owns a modest home and has been working in the area for a couple of decades, chances are you may already be looking at Washington Estate Tax exposure for your estate.
- Asset protection. Assets in an irrevocable trust are protected from creditors and lawsuits.
- Avoid probate. Irrevocable trusts can avoid probate proceedings.
- Privacy. The terms and assets of an irrevocable trust are private and not available to the public.
There are two types of irrevocable trusts:
- Living trusts, which are established while the grantor is still alive.
- Testamentary trusts, which are established after the grantor's death based on provisions defined in the testator’s complex will.
One final note: It's important to use the correct wording in the trust document to ensure that the irrevocable trust language is enforceable in the state where it's created.
Schedule a free consultation today to discuss your personal estate planning needs.
Irrevocable Trusts
An irrevocable trust is a legal arrangement that cannot be changed or ended by the person who creates it (the “settlor” or “grantor”). The grantor transfers assets to a trustee who manages the trust, and the terms of the trust become legally binding.
Irrevocable trusts are often used for estate planning and asset protection. Some benefits of irrevocable trusts include:
- Tax benefits. Assets in an irrevocable trust are not included in the grantor's taxable estate, which can reduce the grantor's tax liability (and is particularly pertinent in Washinton where the individual estate tax threshold remains $2.193 Million). For example, if you are a Seattle resident who owns a modest home and has been working in the area for a couple of decades, chances are you may already be looking at Washington Estate Tax exposure for your estate.
- Asset protection. Assets in an irrevocable trust are protected from creditors and lawsuits.
- Avoid probate. Irrevocable trusts can avoid probate proceedings.
- Privacy. The terms and assets of an irrevocable trust are private and not available to the public.
There are two types of irrevocable trusts:
- Living trusts, which are established while the grantor is still alive.
- Testamentary trusts, which are established after the grantor's death based on provisions defined in the testator’s complex will.
One final note: It's important to use the correct wording in the trust document to ensure that the irrevocable trust language is enforceable in the state where it's created.
Schedule a free consultation today to discuss your personal estate planning needs.