The Role of Trusts in Estate Planning

One of the most powerful tools in this process is the trust —a legal structure that can simplify asset management, reduce tax burdens, and ensure your legacy is protected for generations.

 

Whether you’re planning for your children’s future, managing a growing estate, or preparing for long-term care, understanding the role of revocable and irrevocable trusts is key to building a secure estate plan tailored to your needs.

 

 

What is a Trust?

A trust is a private legal agreement that allows a person (the grantor) to transfer ownership of assets—such as property, investment accounts, or savings—to a separate legal entity managed by a trustee. The trustee then manages and distributes those assets to designated beneficiaries based on the terms you’ve outlined.

This approach helps ensure a smooth transition of assets, bypassing probate and giving you greater control over how and when your assets are passed on.

 

 

Revocable Trusts: Control and Flexibility

A revocable living trust is a popular option for Georgia families who want simplicity and control.

 

Benefits:

• Avoids Probate in Georgia: Revocable trusts allow assets to be transferred outside of the court-supervised probate process, which can be time-consuming.
• Easily Updated: You can modify or dissolve the trust at any time during your life.
• Centralized Asset Management: Helps consolidate multiple types of assets—including real estate and investment accounts—under one plan.

Limitations:

• No Tax Shelter: Revocable trusts do not offer estate tax advantages or shield assets from income taxes.
• No Creditor Protection: Assets are still legally part of your estate and could be exposed to creditors or legal claims.

At The Eastman Law Firm PC, we often recommend revocable trusts for clients seeking flexible, probate-avoiding solutions—especially when managing an inheritance for minor children or organizing assets across multiple states.

 

 

Irrevocable Trusts: Asset Protection and Tax Strategy

For clients with more complex planning needs, an irrevocable trust may be more appropriate.

 

Benefits:

• Reduces Estate Taxes: Assets placed into an irrevocable trust are removed from your taxable estate, potentially lowering your estate tax liability.
• Protection from Creditors: Because you no longer legally own the assets, they’re generally shielded from lawsuits or creditor claims.
• Medicaid Planning Tool: Irrevocable trusts can also be used in long-term care planning, particularly when managing asset eligibility for Georgia Medicaid benefits.

Limitations:

• No Control After Transfer: Once established, changes typically require the consent of all beneficiaries or a court order.
• Complexity: These trusts are more rigid and require careful legal structuring to avoid unintended consequences.

At The Eastman Law Firm PC, we help clients across Atlanta design irrevocable trusts that protect their wealth and support long-term strategies for generational giving or elder care.

 

 

Which Trust Is Right for You?

Ultimately, the choice between a revocable and irrevocable trust depends on your personal goals:

• Do you need flexibility, or are you focused on tax minimization and asset protection?
• Is avoiding probate a priority?
• Are you concerned about lawsuits or creditor claims?

Our experienced estate planning attorneys will help you weigh your options and customize a strategy that reflects your needs, your family dynamics, and Georgia’s legal requirements.