Maryland Estate Planning Attorney Assisting Clients with Irrevocable Trusts
Maryland residents who are starting to think about estate planning and providing for their beneficiaries often want to learn more about trusts. A trust is a powerful legal entity that can allow you to ensure that your loved ones receive the assets you intend and that they are taken care of in the event of your death. Trusts also allow individuals to ensure that beneficiaries receive assets smoothly and without making knowledge of those assets public. To be sure, by creating a trust, you can avoid probate.
Deciding to establish a trust can be the easy part. Once you know that you want to work with an experienced estate planning attorney, you will need to decide what kind of trust you want to establish in order to meet your needs. Should you create a revocable or an irrevocable trust? A Maryland irrevocable trust attorney can assist you. Do not hesitate to reach out to the advocates at Frame & Frame to learn more about how we can help with your estate planning.
What is an Irrevocable Trust, and How Does it Differ from a Revocable Trust?
Trusts can be expensive to create, and they are not appropriate for everyone. In some circumstances, it may be better to work with a attorney on creating a will through which you can ensure that your assets are distributed according to your wishes. If a trust is a good option for your situation, then you will first need to determine whether you want to establish a revocable or an irrevocable trust. Generally speaking, the answer to that inquiry often depends upon how you respond to this question: do you need or want control over your assets and your property during your lifetime?
A revocable trust does exactly what its name suggests. In brief, it allows you to revoke, or change, the terms you have set up for the trust as long as the law says you are still competent and can make such decisions. An irrevocable trust, differently, does not allow the creator to revoke or revise terms of the trust. Instead, that power is given to a trustee. In most cases, the only way in which the creator of an irrevocable trust can amend or modify terms of the trust is by going through a number of steps that typically involving firing the trustee and gaining approval from the beneficiaries. Based on these differences, it might sound like a revocable trust is always better. Yet there are reasons that an irrevocable trust might be the right choice for you.
Benefits of an Irrevocable Trust
A Maryland irrevocable trusts attorney can assess your particular situation and help you to decide what kind of trust fits your need. In general, however, the following are some benefits associated with an irrevocable trust:
- Asset protection (for example, if there is ever a judgment against you, the assets in the irrevocable trust cannot be taken from you to pay a judgment);
- Limits to estate taxes (when you have assets in an irrevocable trust, those assets are not included in the value of your estate when it is time to determine an estate tax); and
- Medicaid planning (assets in an irrevocable trust, depending upon when it is creating, may not be taken into account when the government determines whether you are eligible for Medicaid benefits for nursing home care).