While an irrevocable trust may help with asset protection and lower estate burdens, they may not be right for everyone. Once the trust is created and assets are put in it, the assets belong permanently to the trust until distributed to the beneficiary. An irrevocable trust may be created and funded while a Georgia resident is alive or created during life and funded after the grantor passes away.
Examples of trusts that may be funded during an individual’s lifetime include a qualified personal residence trust and the grantor retained annuity trust. A QPRT allows an individual to transfer ownership of a home to the trust, and a GRAT allows individuals to transfer cash to their heirs without any tax liability. A testamentary irrevocable trust is funded after an individual passes away and is done so based on instructions left behind in the testator’s will.
There are several good reasons why an individual may create such a trust. For instance, it may help him or her retain government benefits without having to use personal resources to pay for in-home care. It may also help to ensure that assets are not squandered by beneficiaries. However, it is still important to remember that the terms of the trust cannot be changed at any point, so individuals should be comfortable with any decision that they make.
Those who are interested in trust planning may wish to meet with an attorney in order to discuss their objectives. An attorney may be able to help create a trust or review the terms of one that is currently in existence.
Kevin Tharpe
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