What is the difference between a revocable and irrevocable trust, and which needs do they serve?

The ability to change is at the heart of the difference between revocable and irrevocable trusts. Revocable trusts take their name from the trustee’s ability to “revoke” (i.e. change) provisions of the trust agreement after signing. These changes could include adding or removing beneficiaries of the trust by amendment or even dissolving the entire trust. Unless a successor trustee is named in the trust agreement, a revocable trust becomes irrevocable upon the death of the person or persons who formed it.

Revocable trusts can be an important tool in estate planning. Like a will, they offer a flexible option in assigning responsibilities and dividing property after one’s death. Unlike a will, however, revocable trusts do not need to be submitted to probate and will remain private. The value and division of one’s estate will not be known and thus not become a source of public speculation or possible family conflict.

Additionally, through the appointment of a successor trustee and a disability clause, a revocable trust can be used to transfer one’s property during life if one should develop dementia or another condition that prevents management of the estate.

Irrevocable trusts, by analogy, cannot be changed after signing; there is no going back on decisions made or property assigned. Irrevocable trusts are more often used near the end of life to assign one’s property to another, thus avoiding estate taxes.

Call our office today to discuss which trust or other financial instrument best suits your estate-planning needs.

Share on facebook
Share on twitter
Share on linkedin
Share on pocket
Share on email
Related Posts

Cannabis DUI

Marijuana and derived cannabis products are now legal for private, at-home consumption in Massachusetts. With the use of THC products now legal and in the open, it becomes even more important to remember continuing legal restrictions on and best practices surrounding their consumption. One of the

Read This

Rear-end collisions and the rush to settle

Rear-end collisions are not uncommon, but they are not simple or routine. Repeat after me: there is no such thing as a ‘simple’ rear-end collision. Again, there is no such thing as a “routine” rear-end collision. Rear-end collisions come on a sliding scale, ranging from the

Read This

Looking For Answers?

We help people like you through difficult times.
Contact us Now