Will a Revocable Living Trust protect my assets from creditors?
- March 18, 2022
- David Greene
- Comments Off on Will a Revocable Living Trust protect my assets from creditors?
Many people are confused and sometimes misled about the differences in a revocable living trust and an irrevocable trust. Many advantages are common to both, such as: (1) both will avoid probate if handled properly, (2) both will allow the trustor to pass his assets through two or three generations, (3) both will allow assets to be spread out so as to avoid or lessen estate taxes and (4) both are private documents not subject to public scrutiny or court approval. However, a revocable trust cannot protect your assets from creditors. It is not meant to do that. The irrevocable trust can protect your assets from creditors. However, you as creator of the trust have far less leeway in altering the trust or taking assets from the trust for your own immediate use. The Trustor (creator) cannot be the Trustee of his irrevocable trust.