Setting up a trust as part of your estate plan is a common move. It enables you to protect your assets and heirs from excessive taxes after your death. A trust also is a good way to avoid probate trouble. However, when setting up a trust in Tennessee, you need to decide between irrevocable and revocable trusts.
According to U.S. News and World Report, your decision between the two types of trusts depends on how much control you want to have over it. Once you create the trust, you need to think about your needs and how you might want to alter the trust in the future because this will help you make the decision between the two.
An irrevocable trust is pretty much final once you create it because it automatically goes under the control of the trustee. You cannot alter it or even revoke it unless you have approval from the trustee and beneficiaries. It is difficult to change this type of trust once you have it in place, which gives you little control over it.
A revocable trust is not as final. You can always go back and make changes or even revoke the trust after its creation. You maintain control over the trust and the assets in it until your death. At that time, the trustee takes over the management.
Before deciding on which trust to use, make sure you consider what could happen in the future and what you want to happen with the assets in the trust. If you have any uncertainty, you might want to default to a revocable trust so that you can change it later if needed. This information is for education and is not legal advice.