With Irrevocable Trusts, It’s All About Who Has Control

An irrevocable trust must be carefully funded, structured and managed to achieve both asset protection and tax planning.

The view of an older man from behind as he drives an open convertible down an open country road.
(Image credit: Getty Images)

Editor’s note: This is part four of an ongoing series about using trusts and LLCs in estate planning, asset protection and tax planning. The effectiveness of these powerful tools — especially for asset protection and tax planning — depends very much on how they are configured to work together and whether certain types of control over assets and property are surrendered by the property owner. See below for links to the other articles in the series.

Revocable trusts and irrevocable trusts are created through contracts in which a person is appointed as “trustee” to hold title to property, with an obligation to use the property for the benefit of another person as the “beneficiary.” Both revocable trusts and irrevocable trusts are excellent estate planning tools, but by giving up additional control over assets in an irrevocable trust, an irrevocable trust can be a much more powerful tool for asset protection and tax planning.

Subscribe to Kiplinger’s Personal Finance

Be a smarter, better informed investor.

Save up to 74%

Sign up for Kiplinger’s Free E-Newsletters

Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.

Profit and prosper with the best of expert advice - straight to your e-mail.

Sign up

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

To continue reading this article
please register for free

This is different from signing in to your print subscription

Why am I seeing this? Find out more here

Rustin Diehl, JD, LLM
Attorney and Counselor at Law, Allegis Law

Rustin Diehl advises clients on tax, business and estate planning matters. Rustin serves as an adjunct professor, frequent speaker and is current or former chair of professional associations. Rustin is a prolific author and has published many technical and popular articles on estate and business issues, as well as drafting and advising legislators in developing numerous statutes pertaining to trust and estate and business planning, creditor exemption planning and digital asset (blockchain) trusts and blockchain entities known as decentralized autonomous organizations.