Connect with us

Law

Know How A Revocable Living Trust Is Related To Asset Protection

Estate planning is one of the important things that many individuals work on during their lifetime. There are many estate planning tools in the market to achieve this but the most important one is a living trust. This is a tool to ultimately pass the assets to heirs rather than creditors. A trust is, in fact a formal agreement to pass the ownership of various assets to another person or entity called trustee, who would then administer the benefits of those assets to an individual, group or entity commonly referred to as beneficiaries. All types of trusts come with documents that contain written responsibilities that the trustee should perform, as well as other legally needed tasks for the transfer, without hassles.

Revocable Vs Irrevocable

There are mainly two types of trust, namely revocable and irrevocable trust that individuals and corporates use for their assets. A revocable trust is used by most individuals who want to transfer their assets but in a direct way, especially when they have no reasons to worry about creditors or individuals not related to the asset. Before getting into a revocable trust in detail, let us learn about what an irrevocable trust can do.

  • An irrevocable trust once established by the creator of the trust can no longer be modified by anyone, even the trustee or beneficiary. Also, the trust is no longer owned or controlled by anyone including the creator. So, creating an irrevocable trust is to surrender the ability to change or modify the trust instrument. This means any claim made by a creditor on the assets held in a irrevocable trust is considered void. A future creditor will have no right to dig into these assets to satisfy a judgement made for unpaid bills. This rule also holds good in cases where the trust creator is the beneficiary of the assets in the discretionary trust. Note that the extent of protection from irrevocable trust rely largely on state laws, so it is important to be informed of the laws pertaining to the state in which the trust is created.
  • One more thing; an individual or entity transferring assets to an irrevocable trust in order to escape from creditors is considered illegal and such transfers can be canceled by a court if it finds the reason for transfer. These transfers can also carry a huge legal penalties – another reason why it is crucial to learn about asset protection through trust. A legal counsel like Revocable living trusts Jacksonville can help you learn about irrevocable trust planning in detail.

A Trust That Can’t Protect

Now coming to the main subject of this discussion – the revocable trust and how it relates to creditors and entities that are after your money. As shocking as it seems, a revocable trust may not be able to  protect your assets from creditors. This is mainly because as the term revocable suggests, the creator of the trust can change or modify the terms of the trust at any time during the lifetime of the trust. Due to this flexibility, a creditor who is after the asset may force the creator or owner of the trust to change or even terminate the trust in order to make them surrender those assets. When you set up a revocable trust as a way to avoid probate, you let yourself keep control over the assets in the trust. This means when the trust is revoked at any time, the assets would be in your name. The asset is considered yours and will be available to creditors when they can get to those assets through court judgement or lawsuits. In essence, a revocable trust is not the way to go if your intention is to protect your assets from creditors. For more information, contact Living trusts Jacksonville company.

Tags:Revocable living trusts jacksonville, Living trusts jacksonville

Continue Reading

Recent Posts

Home Improvement1 week ago

Mastering The Maintenance: Breaking Down The Basics Of Your Ducted Heating And Cooling System

Welcome, fellow home enthusiasts! Ever find yourself lost in the labyrinth of your ducted heating and cooling system? Have you...

Business3 weeks ago

The Invisible Hands: Unveiling How Food Distributors Influence the Quality of Our Foods

Ever found yourself wondering why the tomatoes in your salad taste particularly fresh or why your preferred brand of coffee...

Marketing3 weeks ago

Webflow CMS: A Comprehensive Guide

Webflow is a powerful tool that allows you to create and manage dynamic websites without needing to code. It’s a...

Business3 weeks ago

The Three Most Important Benefits You Should Offer To Your Employees

Offering your employees a range of benefits on top of regular salary increases will really help to show that you...

Business1 month ago

Business Tips For Protecting Your Finances During A Recession

In 2024, taking the necessary steps to protect your finances for your business is now more important than ever. The...

Green & Energy2 months ago

Air Conditioning Installation: What You Need to Know

When it comes to getting an air conditioning unit installed, can significantly improve your comfort and home environment, especially during...

Marketing2 months ago

Marketing Tips For A Gym Wear Brand

When starting a gym wear brand, there are a few things you need to do and one of them is...

General2 months ago

Social Media Marketing: What Are All The Types?

Social media marketing is a tool that is a must-have in today’s digital age. it’s very rare that businesses can...

Business3 months ago

How To Become A Property Developer

There are several reasons why an individual will want to become a property developer. One of the main reasons for...

Business3 months ago

Remote Delivery Innovations: Case Studies from Leading E-commerce Brands

People have gone through much change in the past few years when it comes to online shopping. Nowadays, when delivery...

Business3 months ago

Why are Brits turning to online-only banks?

For years, large, conventional banks held all the aces when it comes to citizens’ finances in the UK. HSBC, Lloyds...

5 Important Web Design Considerations to Make For Better SEO 5 Important Web Design Considerations to Make For Better SEO
Tech4 months ago

5 Important Web Design Considerations to Make For Better SEO

Ever since the birth of search engines, practices in optimising websites for better search rankings have changed considerably. Where it...

SEO4 months ago

The Importance of Local SEO for Small Businesses

There are many different types of businesses and all of them will require online marketing however, with a small business,...

General4 months ago

Understanding The Unsung Heroes: Cool Rooms And The Importance Of Regular Repairs

Everybody loves a breath of fresh air when entering a superstore! But have you ever wondered who’s working backstage to...

Home Improvement8 months ago

How To Add More Value To Your Home

If you have some spare cash in the bank, it is likely you would like to spend it on your...

Categories

Archives

Trending