On August 5, 2014

When planning for the future, people can develop various types of trusts, depending on their wishes and needs. Here’s a look at some of the more common types of trusts.

When planning for the future, people can develop various types of trusts, depending on their wishes and needs. Here’s a look at some of the more common types of trusts.

When it comes to developing a trust, people will have a number of different options from which to choose, and the best choice (or choices) for them will depend on various factors, some of which include:

  • Whether a person wants the power to alter the trust in the future
  • The beneficiaries a person will want for the trust
  • Any special rules or instructions the individual may want in place for the trust
  • Whether the individual developing the trust wants to take advantage of certain tax breaks.

Given that there are various types of trusts available, in this three-part blog, we will take a closer look at some of the most common types of trusts and explain the benefits of each. Keep in mind that the discussion herein has been provided as a general overview and that you can easily obtain more specific info and professional legal advice regarding trusts by contacting the Denver trust attorneys at JR Phillips & Associates, PC.

A Look at Some of the Most Common Types of Trusts

1. Revocable Trusts

Also referred to as living trusts, these types of trusts essentially permits the trustmakers (i.e., the individuals who are developing the trusts) to be able to make changes to the stipulations of the trusts at any point in the future. For example, while trustmakers will be able to remove property from revocable trusts if they choose to do so, they may also be able to change the named beneficiaries of living trusts.

Revocable trusts can be effective estate planning tools for people who would like to help their loved ones avoid dealing with probate in the future. However, it’s important that people who are considering setting up these types of trusts are aware that:

  • The assets owned by these trusts may be still accessible to creditors (if the estate is in debt upon the passing of the trustmaker).
  • These trusts automatically become irrevocable trusts upon the trustmaker’s passing

2. Irrevocable Trusts

These types of trusts, which are the counterpart to revocable trusts, cannot be changed or amended once they have been put into effect. What this specifically means is that, as soon as an irrevocable trust has been legally authorized, a trustmaker will no longer have the power to remove the assets of the trust, alter the trust’s beneficiaries or make any other changes to the rules or nature of the irrevocable trust.

For our continued discussion of types of trusts and their specific benefits, be sure to check out the upcoming second and third parts of this blog.

Denver Trust Attorneys at JR Phillips & Associates, PC

When you are ready to set up a trust and proceed with estate planning for your future, you can turn to the trust lawyers at JR Phillips & Associates, PC. We provide a thoughtful, comprehensive approach to our clients’ estate planning needs, and we take pride in helping each of our clients and their families find the best solutions for them.

Contact Us

Let’s talk about your options for devising trusts during an initial consultation. To schedule this meeting, call us at (303) 741-2400 or email us using the contact form at the top of this page.

From our offices in Denver, we serve clients throughout the southwest and southeast Metro Area, including (but not limited to) people in Highlands Ranch, Littleton, Castle Rock, Parker, Aurora, Greenwood Village and Englewood.

Categories: Trust Administration, Trusts