Irrevocable trusts may be useful to some in Pennsylvania

| Aug 17, 2020 | Estate Planning |

Everyone’s life has an overwhelming number of minor details. Because those details differ from person to person, every estate plan is different as well. As a result, irrevocable trusts may be useful planning tools for some Pennsylvania residents, but not necessarily for others. When it comes to using this type of trust, there are specific scenarios in particular that it could prove useful for.

One good reason to use an irrevocable trust is if a person could face collections from creditors or could have to pay compensation as the result of a lawsuit in the future. By putting assets into an irrevocable trust, those assets are removed from the estate and, essentially, that person’s ownership. As a result, creditors cannot gain assets to those funds in order to cover outstanding liabilities.

Another reason that this type of trust could prove useful is if a person anticipates needing government benefits later. It is common for older individuals to need long-term care at some point, and paying for that care can be burdensome. Though programs like Medicaid exist, it only helps individuals who qualify. If individuals have too many assets, it is likely that they will not meet the requirements. However, if they move assets into an irrevocable trust and, again, remove it from the countable estate, it could help them obtain that much-needed financial assistance.

Irrevocable trusts may not suit everyone’s needs, but for some, they could help avoid difficult situations. If Pennsylvania residents are interested in gaining more information about this estate planning option, they may want to discuss it with knowledgeable attorneys. These legal professionals can help parties assess their individual needs and find the right planning options for their futures.

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