What is an irrevocable trust?

An irrevocable trust is a type of trust in which the terms and conditions cannot be altered, amended, revoked, or terminated. This is in contrast to revocable trusts, which can be changed by the settlor (grantor) at any time. In New Hampshire, irrevocable trusts are created for a variety of reasons, including to protect assets, transfer wealth, provide for kids’ and heirs’ inheritance, and avoid or reduce estate taxes. An irrevocable trust works by transferring legal ownership of assets from the settlor to the trust. The trust assets are managed by a trustee, who is responsible for managing the trust assets according to the directions of the settlor as outlined in the trust document. The trust assets can also be used for the benefit of designated beneficiaries, such as the settlor’s children or other heirs. Because the trust assets are no longer owned by the settlor, they are no longer liable for the settlor’s debts, taxes, or other liabilities. Additionally, the trust assets are protected from creditors and beneficiaries who may seek to attach them. The irrevocable nature of the trust also means that it cannot be changed or revoked without court approval. One thing to keep in mind with irrevocable trusts is that, because the settlor gives up control of the trust assets, they cannot be returned to the settlor under any circumstances. For this reason, setting up an irrevocable trust is a serious decision that should not be taken lightly. It is important to speak with an estate planning attorney who is experienced in New Hampshire trusts and estates law to ensure that the trust is established properly and meets the settlor’s needs and goals.

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