When planning your estate, you may assume that a will is the only document you need. While this is an essential tool, there are other options to help you provide for your loved ones after your passing. One option you may want to consider is creating an irrevocable trust fund with the assistance of St. Louis wills & trusts lawyers. If you’re unsure how this works or what the benefits are, the following blog explores what you should know about this option so you can best protect your assets and loved ones.

What Is an Irrevocable Trust?

An irrevocable trust is a kind of trust fund established by the creator, officially referred to as the grantor. This trust, once created, cannot be changed, modified, or revoked without a court order. When the grantor places assets and funds inside this kind of trust, they are no longer considered the owners of the assets. Instead, the trust becomes the legal owner of the assets.

The assets held in an irrevocable trust are managed by a trustee, who is appointed by the grantor. The trustee is responsible for managing the assets and distributing them to beneficiaries in accordance with the terms and conditions created by the grantor.

What Are the Benefits of This Option?

While relinquishing control of the assets held in an irrevocable trust may seem like a downside, this option offers considerable benefits for the grantor and their beneficiaries. One of the primary benefits of creating an irrevocable trust is asset protection. When you are sued, creditors and courts can seize your assets. However, if you create an irrevocable trust fund, you no longer legally own the assets. As such, they cannot be taken from the trust to satisfy judgments. This means you can achieve peace of mind knowing your assets will not be taken and can instead go to your beneficiaries as intended.

Another benefit of creating an irrevocable trust is that establishing one can help rescue estate taxes. Because you are relinquishing ownership of your property, it is no longer considered part of your taxable estate. As such, your beneficiaries will not have to pay taxes on the assets transferred to them, meaning they can reap the full benefits of the assets.

How Do I Create One?

If you are interested in creating an irrevocable trust, it’s important to understand the steps in the process to create one. Generally, the first thing you should do is determine the assets that you would like to place in the fund and how you would like them distributed to beneficiaries. Next, you’ll need to appoint a trustee to oversee and manage the assets on your behalf. This is not a decision that should be made lightly, as this is a significant responsibility. After these steps have been completed, you can transfer the assets into the trust and finalize the paperwork.

However, the most important step you can take to create an irrevocable trust is to meet with an experienced estate planning attorney. Unfortunately, establishing an irrevocable trust requires a considerable amount of careful planning, and if you try to navigate this on your own, you can make financial mistakes that will impact you and your beneficiaries for years. However, obtaining legal representation to help you through this process is imperative, as it will ensure your trust is legally valid and reflects your wishes.

At Stobie Family Law Group, we understand how confusing estate planning can be, especially when it comes to navigating trust funds. That’s why our team is committed to making the process as simple as possible for you, so you can receive peace of mind that your wishes will be honored. If you’re ready to create an irrevocable trust fund, reach out to our firm today to get started.