Should I Create a Revocable or Irrevocable Trust?
Whether you have just started to think about estate planning, or you have a particular idea in mind about creating a trust as part of your existing estate plan, it will be important to make sure that you establish the right type of trust based on your needs. As you consider establishing a trust, you may be wondering if you should be planning to create a revocable or an irrevocable trust. The answer will depend on the reasons you want to create the trust, and what you want the trust to do. Once you speak with a lawyer about those issues, it is likely that you will have the question of whether to establish a revocable or irrevocable trust answered for you. Our Gwinnett County estate planning lawyers can explain in more detail.
Understanding Revocable Versus Irrevocable Trusts
Under Georgia law, all trusts will be either revocable or irrevocable — all of the various kinds of trusts that can be created will fall into one of these two categories. Revocable trusts are those that can be amended or canceled by the party who creates the trust (that party is usually known as the grantor or settlor in Georgia), whereas irrevocable trusts cannot be amended or canceled. Once an irrevocable trust is established, its terms cannot be changed in any way, and the grantor cannot decide against the trust later on.
For many kinds of trusts, a grantor cannot choose between making the trust revocable or irrevocable, especially when a trust is created for the purpose of allowing the beneficiary to maintain asset-related or income-related eligibility for certain public programs (such as a Medicaid Asset Protection Trust or a Special Needs Trust), or when a trust is designed to provide tax benefits or protect assets from creditors.
Why Are You Creating the Trust, and Who Will the Trust Benefit?
To determine whether you should be creating a revocable or irrevocable trust, you will want to answer this two-part question: why am I creating the trust, and who will the trust benefit? If your primary aim in establishing the trust is to allow your loved ones to avoid probate, a revocable living trust is often the best option since it will pass to beneficiaries without needing to go through probate, but you will have the flexibility of being able to alter it, amend the terms, or even cancel it during your lifetime.
Otherwise, if you intend to establish a trust for a reason other than avoiding probate, you will likely want to discuss specific types of irrevocable trusts with an estate planning lawyer, with your intended beneficiary in mind.
Contact a Norcross Estate Planning Attorney
Are you considering the possibility of creating one or more trusts as part of your estate plan? Trusts can be beneficial in many different ways, depending on the specific type of trust and the particular needs of the grantor. Depending on your circumstances, you may want to consider different types of both revocable and irrevocable trusts, but one of the experienced Norcross estate planning lawyers at Bowman Law Firm can discuss your personal details with you today and can help you to understand your options. Once you are ready to create a trust or any other components of your estate plan, our firm is here to help. Contact us today to find out more about the services we provide for clients in Georgia.
Source:
law.justia.com/codes/georgia/title-53/
