Intentionally Defective Grantor Trusts
An Intentionally Defective Grantor Trust is a type of irrevocable trust, which means once it is set up, it cannot be modified. You should consult with The Law Offices of Deborah Azar, P.C. to see if an Intentionally Defective Grantor Trust is the right trust for you.
With an Intentionally Defective Grantor Trust the person setting up the trust, the trustor or grantor, retains ownership rights or control over a business or other asset for income tax purposes, while still preserving and protecting the business for estate tax purposes. This kind of trust can also affect the determination of capital gains tax because appreciation occurs inside the trust.
An Intentionally Defective Grantor Trust removes assets from your estate protecting the asset from creditors and reducing your estate.
You need expert advice from an attorney in order to set up a trust. You will need help determining what type of trust is better for your circumstances, assets and plans. You also want expert advice and guidance throughout the process so that you end up with a document that reflects your vision and achieves your goals.