Business Definitions -Irrevocable Living Trust

Irrevocable Living Trust - Advantages and Disadvantages

A Living Trust Irrevocable - Definition

An Irrevocable Living Trust is an arrangement in which the grantor departs with ownership and control of property. Usually this involves a gift of the property to the trust. The trust then stands as a separate taxable entity and pays tax on its accumulated income. Trusts typically receive a deduction for income that is distributed on a current basis. Because the grantor must permanently depart with the ownership and control of the property being transferred to an irrevocable trust, such a device has limited appeal to most taxpayers.

Advantages of a Irrevocable Living Trust

• You observe your trustee in action
• You avoid probate and court costs
• You probably will save some fees
• It is a good way to pass property to charity
• You save any taxes there may be on the property going to charity on your death
• With irrevocable charitable remainder trusts, created while you are living, you can get an income tax deduction during your life
• You may save taxes on capital gains on property placed in a charitable remainder trust

---

Disadvantages of a Irrevocable Living Trust

• Property must be transferred, so there is initial cost in setting up the trust
• You lose all control over the property with most irrevocable trusts
• It requires annual fiduciary accounting and possible tax returns
• It may require payment of annual trustee fees
• There may be fees at the time of trust termination
• You can't change your mind and get the property back

Irrevocable Living Trust

---

| Bad Credit Loans | Bad Credit Mortgages | Bi Weekly Mortgages | Business Loan Women | Consolidate your Student Loans | Fannie Mae Mortgages | FHA Loans - Mortgages | Freddie Mac | Ginnie Mae | MBDA - Minority Business Development Agency | Select your Mortgage Type | Negative Interest Mortgage | Refinance Home Mortgage | Reverse Mortgagges | Second Mortgages | VA Mortgages | Women's Business Loans | Women in Business | Women's Government Contracts | Wrap Around Mortgages

---

Home | Site-Map

---