If you have wealth that you want to distribute to your loved ones, then you need to make sure that you plan ahead. There are a few options available to you based on your needs, but one that provides a few advantages is a revocable trust. Although there are several varieties of trusts out there, revocable trusts can be better for you and those you wish to provide for, depending on the situation. Today we’re going to discuss the ins and outs of revocable trusts, from how they work to whether or not you need to apply for an EIN online.
What is a Revocable Trust?
This is a type of trust whereby the grantor (the person creating it) can make changes and amendments as he or she sees fit. This kind of trust must be drafted when the grantor is still alive, as it becomes irrevocable after death. The name of this trust refers to the fact that the grantor can revoke the agreement at any time.
Why is this Trust Beneficial?
When figuring out the right way to disperse funds to family members and loved ones, a trust is a good option because it has strict rules about how it can operate. Also, it can pay out before your death, making it much more open-ended than a will.
A revocable trust is ideal for the following reasons:
- If probate (proving validity of a trust or will) is going to be complicated or expensive
- You can save money on federal estate taxes
- Enables you to draft plans for disabled beneficiaries
- Allows you to dictate when the trust pays out (i.e., when the trustee reaches a certain age)
- You don’t have to disclose the details to the public
- You can name yourself as the trustee if you like
- You can ensure that your funds are managed correctly in case of death or disability to yourself
- It provides long-term access to resources without legal or court interruption
- The trust is protected if the grantor becomes incapacitated or dies
Overall, you should seek to create a revocable trust if you want more control over your money and how it’s distributed. For more information on these trusts as well as a church Tax ID number, visit www.irs-ein-tax-id.com.