irrevocable trust - Financial Matter

Why An Irrevocable Trust Can Help With Estate Planning And Asset Protection

Irrevocable trust entities can be a vital part of your asset protection planning. This is because they remove the assets completely from the ownership of the trust creator. If the trust creator should be sued in a civil court at some point in the future, the assets in the trust will have a degree of protection. This protection may be enough to prevent the assets being seized by a future creditor, although there have been many attacks on such trusts in the civil courts. There are some state jurisdictions which offer added degrees of protection, and these can be vital.

Asset protection as a whole is coming far more into mainstream society, having once been a preserve of the rich who could travel to overseas destinations. Civil courts are becoming ever more dangerous to people who own any degree of wealth, so it is easy to see why greater numbers of people are looking for some kind of legal shield. State legislators are providing possible solutions to try to attract money to the state, and there are also overseas options which are now far easier to access.

The key to making these trust arrangements work for you is to keep a close watch on legal cases, especially where a precedent is set which will influence future court outcomes. There are a few exceptional jurisdictions, such as Alaska and Nevada, whose trust laws offer exceptional advantages. The law allows any citizen to set up trusts and corporate entities in whichever state they choose, and even in the vast majority of overseas jurisdictions. There is no point in making hasty arrangements in your own state when you may well be able to secure a better deal elsewhere.

It is possible to set up an irrevocable trust for the dual purposes of estate planning and asset protection. If you set up the trust, and make payments into it, in the right way, the assets of the trust will be excluded from any taxable estate which is left to your heirs. The assets, while under the control of the trust, will also be shielded from many legal threats. If you can incorporate the trust in a state with favorable terms, you can achieve both of your objectives in one solution.

The setting up of irrevocable trusts is best handled by a specialist lawyer, although it is vital that you have a basic understanding of the principles before you start. Only then will you be able to ask the intelligent questions which will draw the best response from the lawyer. This is not a situation where one size will fit everybody, as there are individual quirks in most situations the lawyer will have dealt with. The more accurately you can define your own specific problem, the more likely you are to end up with the right irrevocable trust.

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Source: http://www.financialmatter.net/irrevocable-trust/

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