Trust Lawyers in New Hampshire
What Are the Differences Between Revocable and Irrevocable Trusts?
A trust is a form of estate planning that can go into effect while you are still alive. A trust can give you assurance that your property will be taken care of after your death. It is never too early to make arrangements for your important assets, to ensure that they pass to your loved ones with minimal difficulty. Establishing a trust can help you gain peace of mind and can save your loved ones the hassle of navigating the probate process.
A revocable trust is one that has room for modification. Under this type of trust, you can place assets into a trust and in the future, remove the assets and terminate or change the terms of the trust. An irrevocable trust does not allow amendments or termination except under limited circumstances or as provided by the terms of the trust. After you place an asset or piece of property into an irrevocable trust it belongs to the trust.
Get Help with Your Estate Planning
Placing assets into trusts, particularly irrevocable trusts, may have gift tax, estate tax, and Medicaid planning consequences. An irrevocable trust can be drafted so that income taxes are paid by the creator of the trust (known as the grantor), the trust itself, or the beneficiaries. The consequences are complex and a New Hampshire attorney can help you determine which type of trust is best for your circumstances. This determination will be made after careful consultation and will be based primarily upon your motivation for setting up a trust.
A carefully drafted irrevocable trust can remove assets from your estate for estate tax or Medicaid purposes while still preserving a measure of flexibility to make changes in the future. It can also be used to accomplish charitable estate planning, minimizing income taxes while benefitting a cause or causes that are important to you.
