You have worked hard to establish your significant assets and estate. You would prefer that those assets pass to your heirs rather than the government through harsh estate taxes. If you have a size-able estate, it probably makes sense to use some of those assets to fund an irrevocable trust during your lifetime.
What makes a trust irrevocable? Simply put: after it is in place it generally can’t be changed. Not being able to change a trust is a scary proposition for some, which is why irrevocable trusts are generally used to “excess” assets. The beauty of an irrevocable trust is that the assets in the trust are not considered part of your taxable estate. Additional incidental benefits include asset protection and charitable estate planning. Thus, for certain assets, an irrevocable trust can be a powerful estate planning tool.
How Epiphany Law Can Help
Irrevocable trusts are specialized documents for certain circumstances and needs. You can rely on the experienced estate planning attorneys at Epiphany Law to understand your situation and to work with you to accomplish your goals.
Whether it is lowering your taxable estate, providing for your spouse and loved ones, or protecting your hard earned assets, Epiphany Law can help you in a thoughtful, clear way. You’ve come this far, why leave the future to chance? Contact one of our knowledgeable estate planning attorneys today.
Questions and Answers
Q. Why would I consider creating an irrevocable trust?
A. If your estate is subject to harsh estate taxes, the stakes are very high to minimize those taxes legally and effectively. One manner of lower the amount of your gross estate (and thus lowering the amount potentially subject to estate taxes), is by creating an irrevocable trust. If drafted correctly, assets in the trust will not be part of your estate or subject to estate taxation.
Q. What are some practical uses for irrevocable trusts?
A. Irrevocable trusts come in many different forms and purposes. They can be established to provide an income stream to beneficiaries without being a part of the taxable estate. Additionally, because irrevocable trusts are not owned by the grantor, they can protect assets from creditors. Finally, irrevocable trusts are frequently used to create endowments to charitable organizations and other causes of the grantor’s choosing.
Q. Is there a way to alter irrevocable trusts?
A. Generally not. There are circumstances where certain irrevocable trust modifications can occur but those are rare cases. Some irrevocable trusts include instructions for trustees or beneficiaries to allow for modifications in limited circumstances, such as changes in federal law. Otherwise it can be necessary to seek judicial modification by a court proceeding.