What are the types of trusts?

Trusts are a legal document which allows a person to transfer ownership of their assets or property to another person or entity. In the Commonwealth of Virginia, trusts are subject to the state’s Trusts and Estates Law. Generally, trusts fall under one of four categories: Living Trusts, Testamentary Trusts, Inter-Vivos (or Revocable) Trusts, or Irrevocable Trusts. A Living Trust is created while the individual is still alive. This type of trust is used to manage and protect assets during the grantor’s lifetime—assets that will be transferred to the trustee or beneficiary after the grantor’s death. This type of trust is typically used for estate planning and asset protection. A Testamentary Trust is created by a Will and is established and funded after the grantor’s death. This type of trust is commonly used to manage the grantor’s estate and assets, or as a way to provide for the grantor’s children. Inter-Vivos (or Revocable) Trusts allow the grantor to change or modify the terms of the trust during their lifetime. These trusts are used to manage and distribute assets, and the grantor can change the terms of the trust as their needs or priorities change. Lastly, Irrevocable Trusts are trusts that cannot be changed or modified by the grantor once the trust is created. This type of trust is often used for advanced estate planning and asset protection. Generally speaking, trusts are created to protect and manage assets, and no matter which type of trust is used, they are all subject to the Trusts and Estates Law of Virginia.

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