What is the difference between an irrevocable trust and a revocable trust?

The primary difference between an irrevocable trust and a revocable trust is that an irrevocable trust cannot be amended or canceled by the trustmaker (also known as the grantor) after it is created. In contrast, a revocable trust allows the trustmaker to modify or revoke the trust at any time during the trustmaker’s lifetime. Another major difference between the two types of trusts is that assets placed in an irrevocable trust are generally protected from creditors, whereas assets placed in a revocable trust are typically not afforded the same protection. This is why an irrevocable trust may be used in Washington as a tool for asset protection. An irrevocable trust can be used to transfer assets out of the trustmaker’s name and into the trust, protecting those assets from any creditors or legal claims. A revocable trust, on the other hand, does not provide the same asset protection benefits. In addition to the differences in asset protection and modification, irrevocable trusts are also often used in estate planning, while revocable trusts are mainly used for efficient management of assets during the trustmaker’s lifetime. With an irrevocable trust, the trustmaker can arrange for assets to be distributed according to their wishes after they die, while with a revocable trust they can manage their assets while they are still alive. Overall, the major distinction between irrevocable and revocable trusts is that irrevocable trusts cannot be amended or canceled by the trustmaker after it is created, and offer greater asset protection benefits than revocable trusts, which can be modified or revoked at any time during the trustmaker’s lifetime.

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What is the difference between an irrevocable trust and a revocable trust?

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