What Is a Revocable Trust?

A revocable trust is a legal document where you own all your assets and pay taxes on them until you pass away.

When you’re doing estate planning, you may come across something called a “revocable trust.” By learning more about this type of trust, you can determine if you’re going to use it in your estate plan.

The Definition of a Revocable Trust

A revocable trust is a legal document that shows how your assets are going to be handled when you pass away. You name your beneficiary designations for the trust, and then your assets are transferred to them when you die. However, you can cancel or change the provisions in your trust at any time. So, for example, if you are at odds with a family member, you can remove them from your trust so they will not receive anything.

Revocable Trust vs. Irrevocable Trust

A revocable trust opposite of an irrevocable trust, where you are not allowed to change it without approval from every person named in the trust. For example, when trying to remove a beneficiary from an irrevocable trust, you need that beneficiary to agree and sign off on this action. Essentially, as soon as you sign an irrevocable trust, you no longer own the assets. Note that if you have a revocable trust, you will pay taxes on it like estate taxes and income tax. With an irrevocable trust, you don’t pay taxes — the trust itself does.

Contacting Richard P. Arthur for Help Creating a Trust

Richard P. Arthur, Attorney at Law, can walk you through whether a revocable or irrevocable trust would be better for you and your family. All you have to do is call 937-254-3738 for a consultation. He has nearly three decades of experience advocating for families in Dayton, Trotwood, and Montgomery County and he’s ready to assist you, too.