When Georgia residents are planning their estates, there are many ways for them to ensure that their loved ones will be provided for. However, there are situations where they may want to keep control over their assets. Irrevocable trusts not only allow people to retain control, but there may also be tax savings and other financial benefits.
The difference between an irrevocable trust and a revocable trust is that, once the terms of an irrevocable trust are set, those terms cannot be changed in the future. Revocable trusts, on the other hand, can be changed or even terminated. However, people can set up an irrevocable trust during their lifetime or as provisions in the will. The provisions would not take effect until after the person’s death. While the settlors are still alive, they can make changes to the will which then can result in modifications to the terms of the irrevocable trust.
Irrevocable trusts can have an estate tax benefit if set up correctly. After the initial gift is made to the trust, any appreciation in the property that is included in the trust will not be taxable. As a result, the appreciation will belong to the beneficiaries.
Estate planning can be extremely complex, especially if people have a number of assets he or she would like to leave for his or her family members. Because there are different types of trusts, it can be difficult to determine which one is appropriate. An estate planning attorney can often be of assistance in this regard.