Revocable and irrevocable trusts are one of many estate planning tools available. When planning your estate in Oklahoma, trusts can offer flexibility, privacy, and control over how your assets are managed and distributed. Two of the most common types of trusts are revocable trusts and irrevocable trusts. Understanding their differences is essential to choosing the right tool for your estate plan.
What Is a Revocable Trust?
A revocable trust, often called a living trust, allows the person who creates the trust (the grantor) to retain full control over it during their lifetime. This means you can amend the trust, change beneficiaries, add or remove assets, or even revoke the trust entirely.
Key Features:
- You serve as trustee during your lifetime.
- Assets in the trust avoid probate upon your death.
- You can make changes at any time while you are mentally competent.
- Offers privacy, since trust assets do not become part of the public probate record.
However, because the assets remain under your control, they are still part of your taxable estate and may be accessible to creditors or subject to nursing home costs.
What Is an Irrevocable Trust?
An irrevocable trust, as the name implies, cannot be altered or revoked once it is created (with very limited exceptions). Once you transfer assets into this type of trust, you give up control of those assets. A third-party trustee typically manages the trust.
Key Features:
- Offers protection from creditors and lawsuits.
- Assets are generally not part of your taxable estate.
- May help you qualify for Medicaid by reducing your countable resources.
- Beneficiaries receive the property outside of probate.
Because you no longer own or control the assets, you can’t change the trust terms after finalizing it—so this type of trust requires careful planning.
Choosing Between the Two in Oklahoma
Revocable trusts are ideal for individuals who want flexibility and privacy in managing their estate while retaining control. These trusts are commonly used in Oklahoma to avoid your estate going through the courts and probate, especially for those with real estate or assets in multiple counties.
Irrevocable trusts are more suitable for individuals looking to protect assets from creditors, reduce estate taxes, or plan for long-term care while preserving family wealth.
Wagoner Estate Planning Attorneys
Creating either type of trust involves legal and financial considerations. At our firm, we help Oklahomans understand their estate planning options and craft trust documents that meet their needs. Whether you’re looking to avoid probate, protect assets, or reduce taxes, we can help you choose between a revocable and irrevocable trust with confidence. Call our team of estate planning attorneys at Kania Law – Wagoner Attorneys at 918-283-7394 for a free consultation. Or you can follow this link to ask a free online legal question.
