Georgia estate planners who choose to create an irrevocable trust have made a serious commitment. Essentially, they have decided to give up ownership of their trust property permanently in order to receive the benefits of an irrevocable trust.
Although they will have forfeited control of the property inside the trust, the creators of irrevocable trusts will still be able to control the rules governing the trust, and they’ll be able to dictate how the assets in the trust shall be used. They’ll also be able to select the trustees and beneficiaries of the trust, and can even reserve the right to change who the beneficiaries are.
What are the main features of an irrevocable trust?
Before creating an irrevocable trust, Georgia estate planners will want to consider the various features of this kind of legal document, which include:
There may be tax benefits: Irrevocable trusts can be useful in managing capital gains taxes. Appreciated property can be placed inside a trust, and then sold, without triggering the need to pay capital gains tax.
You don’t own the property anymore: When your property is given over to the trust, it is no longer your property.
Asset protection benefits: One of the best parts of an irrevocable trust is that once you put your money inside it, your creditors cannot take the assets as payment for unpaid debts because it isn’t your property anymore.
You can’t revoke the trust: You won’t be able to dismantle your irrevocable trust after you’ve given up your assets to the trust. Those assets will no longer be your property; they will belong to the trust entity.
Long-term care benefits: For individuals who want to receive government medical benefits as they grow older, putting your personal assets in an irrevocable trust is a way to bring your personal assets to a level that is low enough to allow you to qualify to receive vital financial aid without depleting your savings and legacy for your family.
Learn more about irrevocable trusts
An irrevocable trust is not for everyone, but certain individuals may benefit tremendously from setting up such a trust. Be sure to review all the benefits and drawbacks of having an irrevocable trust before deciding to create these arrangements for your estate plan.