About irrevocable trusts

Nevada residents who want to develop a successful estate plan should make sure that the plan efficiently transfers their wealth to their heirs while reducing any taxes that may be assessed. One particular legal device that can help accomplish this is an irrevocable trust.

When an irrevocable trust is used, the assets transferred into the trust are removed from the estate of the grantor. Many people who use an irrevocable trust in their estate plan believe that it will help protect the assets intended for their heirs, as use of the trust require that the grantor gives up complete control of the assets placed into the trust. However, it is important that grantors understand the effectiveness of the trust in situations in which a beneficiary may be financially irresponsible or gets a divorce.

A trust document is drafted by the attorney to detail the purpose of the irrevocable trust. Once the trust document has been created, changes typically cannot be made to the trust. When the assets are transferred to the trust, the trust immediately becomes the owner of the assets.

Individuals who are considering using an irrevocable trust as part of an estate plan should be aware that the interpretation of the trust is considered a state law issue. The trust document may be used by the courts to determine if a beneficiary controls distribution of the assets. If the beneficiary is determined to have no control, then the assets are not considered marital assets and cannot be seized by creditors.

An estate planning attorney may help clients create a tailored estate plan by assisting with trust planning. The attorney might consider the assets and goals of a client and may recommend certain types of trusts, such as an irrevocable trust, to include in their plan to protect assets for future generations.

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