Irrevocable Trusts in California

Orange County Estate Planning Lawyer

In an irrevocable trust, you place your assets in a trust with instructions to the trustee to care for you and your family as you direct. An important estate planning tool, irrevocable trusts are useful for asset protection, avoidance of probate and tax planning. They can also be used to facilitate eligibility for public benefits such as Medicaid and Supplemental Security Income. For assistance with establishing an irrevocable trust which meets the needs of your unique situation, contact an Orange County trust attorney from our firm.

Benefits of Irrevocable Trusts

  • Asset Protection – If you are sued, you stand to lose your non-exempt assets to execution by creditors. You can protect against this danger by putting assets in an irrevocable trust. As the assets are no longer technically yours, they cannot be reached by creditors. You can still enjoy the benefits of the funds by instructing your trustee to provide for your needs.
  • Avoidance of Probate – As the assets are no longer yours at your death, they bypass probate. This means that you retain privacy against public inspection of your documents, and your heirs do not have to endure the wait which can often last between 9 and 18 months.
  • Tax Planning – You pay no estate taxes on an irrevocable trust, for the same reason that the assets are able to avoid probate – they are not strictly speaking yours at the time of your death. Depending on the schedule of the funding of the trust, you may be required to pay a gift tax, but this can often be avoided if you start early enough and are therefore able to keep the amounts you place in the trust below the exemption amount. The same is true of avoiding the gift tax in the distributions to your beneficiaries.
  • Eligibility for Public Benefits – Long-term care is very expensive and not available through Medicare. If you do not have insurance for long-term care, you would likely be faced with spending down your assets before you could qualify for Medicaid. After spending down, you would have little left over to pass to your family or to provide for personal needs. You can avoid this dilemma by planning ahead. Assets you place in an irrevocable trust five years in advance are not counted in determining eligibility for Medicaid. If you are a Veteran, you can obtain long-term care through the Veterans program. Unlike Medicaid, an irrevocable trust can be implemented at any time while still allowing you to qualify for Veteran's benefits.

Discuss Your Options with an Orange County Estate Planning Attorney

Estate planning lawyer P. Arnsen Blakely is skilled in advising clients on the creation of irrevocable trusts and other types of trusts. He has provided these services to Orange County, California residents since 1971. We invite you to contact us now for a free case evaluation so that you can learn more about your options and begin working on an individually tailored plan for you.

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P. Arnsen Blakely
Orange County Estate Planning Attorney
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Corona del Mar, CA 92625
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