If you are considering creating an estate plan, you are probably looking at using a trust. Trusts are very effective estate planning tools and they provide you with significant flexibility in ensuring your wishes are carried out. Additionally, a trust spares your family from the cost and delay of having your estate go through the probate process. A “living trust,” or one that is created while you are alive, can be revocable or irrevocable.
Revocable trusts
One of the primary purposes of creating a revocable trust is to avoid probate. However, in Utah the probate process is not nearly as burdensome as it is in many other states. However, there are still many other reasons for having a revocable trust, including:
- You can maintain control of your assets
- You can avoid a conservatorship if you should become incapacitated
- You have the ability to change the terms of the trust during your lifetime, including the named beneficiaries or adding/removing assets from the trust
- You can revoke or cancel the trust
- You can maintain privacy with a trust
Irrevocable trusts
An irrevocable trust cannot be changed or revoked by you once the trust agreement has been finalized and signed. Thus, once the assets are transferred into the trust, you are no longer the owner of them because the trust holds title to them. An irrevocable trust can be helpful in a few important ways:
- The income to the trust may not be taxable to you as the trustor
- The assets in the trust may not be subject to death taxes in the estate of the trustor
- It allows you to leave an inheritance for minor children or other beneficiaries and control the timing and the circumstances under which they receive the money
- It can protect the trust assets from beneficiary’s creditors
With any type of trust, it is important to remember that the trust is not effective until it has been funded. This means you must transfer title to your real estate, bank accounts and other assets out of your individual name and into the trust’s name.
Let us help you decide which type of trust will benefit you and your family the most. The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.