You may have already decided to produce a trust rather than a will. Now, your next step is choosing which trust type you wish to work on. You may have heard the terms “living trust” and “revocable trust” tossed around, but you may be unsure if they can used interchangeably or if they are very separate entities. With that being said, please read on to discover whether a living trust is the same estate planning tool as a revocable trust and how a seasoned Broward County trust lawyer at The Probate Lawyers can help you choose the right one for your plan.
Is a living trust the same tool as a revocable trust?
To put it simply first, every revocable trust is a living trust, but not every living trust is a revocable trust. This is to say that a living trust is an umbrella term for different trust types, namely revocable and irrevocable trusts. And so, a living trust is one in which you (i.e., the grantor) may create during your lifetime. Then, a revocable trust is one in which you establish during your lifetime but also may modify or cancel at any point. Of course, this is in contrast to an irrevocable trust, which you may form but cannot change afterwards.
Are all trusts considered types of living trusts?
Even though a living trust is an umbrella term, it does not emcompass every trust option at your disposal. For example, a testamentary trust is not considered a living trust, as it is created from your will document and only goes into effect once you have unfortunately passed on. And so, it is activated during the probate process, which a living trust intentionally works to avoid. Also not considered a living trust is a special needs trust, but it may be formed as a sub-trust within a living trust or will document.
What are the benefits of the different living trusts?
You may be certain that a living trust’s avoidance of probate appeals to you. But from here, you must confirm which offered benefits from a revocable trust or irrevocable trust you would like to take advantage of the most. The distinct benefits of the two are as follows:
- The benefits of a revocable living trust:
- You may modify or cancel the trust at any point.
- You may keep your estate details private from public record.
- You may instruct of asset management should you become incapacitated.
- The benefits of an irrevocable living trust:
- You may shield your assets from creditors or lawsuits.
- You may reduce or eliminate federal estate taxes.
- You may qualify for government programs like Medicaid.
We understand that you may not want to deal with any of this right now, but it must be addressed for your and your loved ones’ sakes. So please allow a competent Broward County estate lawyer at The Probate Lawyers to make this legal process less burdensome for you overall. We will be happy to help and give you much-needed relief.
