An Irrevocable Trust is a permanent, legal document designed to ensure property and assets are held in a secure trust for its intended beneficiaries. Just as the name implies, this type of trust cannot be revoked, modified, or altered once it is established. An Irrevocable Trust is typically set up by the grantor, parent or legal guardian and possess business or individual assets. It is intended to provide for children or relatives who are minors, those who are not fiscally responsible, or individuals with special needs. A trusted third-party, or a trustee, is assigned to help oversee the trust and its property.
It’s important to note, with an Irrevocable Trust, the grantor transfers all ownership of the property and assets to the trust for the specified beneficiary.
Why are Irrevocable Trusts established? Often, this type of trust is utilized to help minimize estate tax liabilities, while transferring ownership from the grantor to the beneficiary.