Should I Create a Revocable or Irrevocable Trust for My Family?
Creating a trust is often beneficial for individuals who want to ensure that their assets are distributed to their loved ones in a timely manner and without the complications of probate. Yet trusts can also be beneficial for many other reasons, both to the beneficiaries and to the settlor (the word used for the person who establishes the trust). In general, trusts must be created either as revocable or irrevocable trusts — revocable trusts can be amended or canceled by the settlor, while irrevocable trusts cannot be amended or canceled (in most circumstances) once established. Both types of trusts allow beneficiaries to avoid probate, but there are more considerations to take into account.
Should you plan to create a revocable trust, an irrevocable trust, or both? Our Connecticut trusts attorney can explain in more detail.
Reasons to Create a Revocable Living Trust
The primary reason to create what is known as a revocable living trust is to allow your beneficiaries to have your property distributed to them efficiently and without the complications of probate. With a revocable living trust, you can make any changes to the trust or even cancel it altogether during your lifetime, and you can manage the assets within it fully. You can also clarify beneficiaries and distributions.
This type of trust, however, cannot be used for some of the purposes of an irrevocable trust.
Reasons to Create an Irrevocable Trust
There are various types of irrevocable trusts that a person can create in Connecticut, and there are many different reasons that you may need to create an irrevocable type of trust for your purposes. Common reasons to create an irrevocable trust include:
- Medicaid eligibility for the settlor for long-term care by establishing a Medicaid asset protection trust;
- For the settlor to minimize or reduce estate taxes on the settlor’s estate;
- Income stream for the settlor through the creation of a charitable remainder trust; and/or
- Settlor wants to provide for a disabled adult loved one through the creation of a special needs trust.
It will be essential to discuss your intentions for the trust with an estate planning attorney who can help you to determine whether a revocable living trust is a possibility, or whether you will also need to consider a specific type of irrevocable trust.
Contact a Canton Trusts Attorney for Assistance Establishing a Revocable or Irrevocable Trust in Connecticut
If you are considering the establishment of a family trust as part of your estate plan, it will be essential to discuss your aims with your estate planning attorney to determine whether you should create a revocable or irrevocable trust, or in some cases both. As we discussed above, both types of trusts have benefits and limitations, but for the purposes of some trusts, the trust must be established as an irrevocable trust. You should discuss your specific needs and all of the details with an experienced Canton trusts lawyer at the Law Office of Brian S. Karpe today. Contact us to learn more about how we can assist you with any trusts you want to create, as well as any other estate planning matters in Connecticut.
Source:
cga.ct.gov/2023/pub/title_45a.htm
