DeKalb County Trust Attorneys

Revocable vs. Irrevocable Trusts in Georgia

A revocable trust, also known as a living trust, is a trust that can be amended, modified, or revoked by the grantor during their lifetime. This trust allows the grantor to control the assets and make necessary changes. Revocable trusts are popular because they provide flexibility and can be structured to convert into an irrevocable trust upon the grantor's death, simplifying asset transfer to beneficiaries.

Once established, an irrevocable trust cannot be altered, modified, or terminated by the grantor except under specific circumstances defined by the trust agreement or by law. 

Because the grantor relinquishes control over the assets placed in an irrevocable trust, these assets are generally protected from creditors. They may provide tax benefits, such as reducing estate tax liability.

Types of Trusts

Multiple types of trusts are available for different purposes, needs, and goals. 

Common trusts include: 

• Living trust: A revocable trust created during the grantor's lifetime.
• Testamentary trust: Created through a will and takes effect upon the grantor's death.
• Charitable trust: Set up to benefit a charitable organization and provide tax benefits for the grantor.
• Special needs trust: Designed to provide for disabled beneficiaries without affecting their eligibility for government benefits.
• Spendthrift trust: Protects beneficiaries from creditors by restricting their access to trust funds.
• Generation-skipping trust: Allows assets to pass to grandchildren or later generations, minimizing estate taxes.
• Bypass trust: Designed to reduce estate taxes by allowing the grantor's spouse to use the trust assets without including them in their estate.
• Qualified Personal Residence Trust (QPRT): This trust allows the grantor to remove their personal residence from their estate, reducing estate taxes while continuing to live in the home for a specified period.