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Estate planning serves many functions, including helping your loved ones receive the funds you wish in the way you want to give them. It also protects your estate from gift and estate taxes. An irrevocable gift trust, or IGT, is an excellent tool that provides flexibility in passing on your wealth to future generations while simultaneously shielding your beneficiaries from paying too many taxes. You may even be able to access trust funds during your lifetime if your trust is set up properly.
Please reach out to our talented legal team for help understanding whether an IGT is suitable for you. We can look at your unique situation and help you determine whether you should create an IGT for the most benefits in leaving behind your legacy. Reach out to us right away for a free consultation at (516) 253-1366.
What is an Irrevocable Gift Trust?
An irrevocable gifting trust allow you to retain some control of your assets while gifting them to someone else during your lifetime. Your trust account will be managed by your chosen trustee, which could be a spouse, sibling, adult child, or close friend.
With an irrevocable gifting trust, your beneficiaries can enjoy the assets in the trust while you are still living. For example, they can reside in a house you gift to them or use the funds in the trust. The trustee carries out the terms under which assets can be accessed according to your instructions. If your gift is made to your spouse, you can easily use the assets yourself.
What Are the Advantages of an Irrevocable Gift Trust?
Irrevocable gift trusts offer several advantages, including:
- Tax advantages – IGTs offer estate tax advantages because they are excluded from the grantor’s estate. They are also protected from being depleted due to income taxes since you can directly pay any taxes owed with your yearly tax payment at your personal tax rate, rather than paying them out of the trust itself at the compressed trust rate.
- Protection for beneficiaries – These trusts offer protection for your beneficiaries against creditors, divorce, and lack of financial management skills.
- Access to trust assets –The grantor may indirectly access the funds, especially if the account is gifted to a spouse.
Should You Hire Our Trusts Attorneys?
Creating a trust is an excellent way to protect your wealth, and irrevocable gift trusts are no exception. However, these documents can be complicated and should be entered into only with excellent legal counsel and representation.
Contact our law firm right away if making an IGT is a good move for your estate plan. We can help you determine the right trust for your family and will create legally sound documents that protect you and your loved ones for years to come. Contact us today to speak with our talented legal team at (516) 253-1366.
