Revocable Trusts (Living Trusts)
A Revocable Trust is the most common centerpiece for a foundational estate plan and acts as a flexible alternative to a Will.
Control: As the "trustor" (creator), you maintain complete control. You can amend the terms, add or remove assets, or completely revoke (terminate) the trust at any time, provided you have mental capacity.
Privacy: In many jurisdictions, a Will must be filed with the County when you pass, which becomes public record and could potentially be viewed by any party, and therefore are not private documents. In contrast, in most cases, a Trust can only be reviewed/examined by the Trustee and the current beneficiaries. Therefore, it is a more private way of holding and distributing assets.
Transition: Upon your death, the trust typically becomes irrevocable, and your chosen successor trustee takes over management to distribute assets without a public court process.
Irrevocable Trusts
An Irrevocable Trust is much harder to change and is primarily used for permanent wealth transfer, tax planning, and creditor protection.
Permanence: Once created, modifying an Irrevocable Trust usually requires the agreement of all beneficiaries, the appointment of an independent trustee, or a court order.
Benefits: Because you give up the power to "pull back" the assets, these trusts can provide protection against death taxes and creditors—benefits that a Revocable Trust cannot offer.
Sub-Trusts: You may encounter irrevocable "testamentary" sub-trusts (like a Marital or Family Trust) within your Revocable Trust workflow. these are only created and funded after a specific event, such as the death of a spouse.
FAQs
Can I create irrevocable trusts with Wealth.com?
Wealth.com does not offer the creation of an Irrevocable Trust document, nor the ability to modify an existing Irrevocable Trust or draft amendments for one. If you want to create an Irrevocable Trust document, you can choose to consult with an attorney who can help. If you don't have an attorney, we can refer you to one from our Wealth Preferred network, and we can inquire with them to see if they can assist with the type of trust you need.
We offer testamentary (Irrevocable) sub-trust options embedded within the Revocable Trust and Last Will & Testament workflows to give you control over the disposition of your assets and to engage in tax planning strategies, including Marital Trust and Trust for Descendants.
Can I name an existing Irrevocable Trust as a beneficiary in my Revocable Trust or Will drafted with Wealth.com?
Currently, the platform does not allow you to name an existing irrevocable trust as a beneficiary or "gift" assets to it. This is a safety measure to prevent violating specific tax statuses or interrupting needs-based benefits (like Special Needs Trusts).
What do I need to do to if an Irrevocable trust is shared with my siblings? How do I incorporate it into my estate planning on Wealth.com?
Currently, we do not allow gifting to existing trusts or entities on the platform, nor naming them as beneficiaries because we do not know the terms of that trust or entity and our drafting therefore cannot speak directly to those terms.