how irrevocable trusts can be used
Irrevocable trusts, unlike revocable trusts, are used as a way to avoid estate taxes. Once a settlor places assets into a trust they no longer become the property of the settlor. From that point on they are the property of the trustee for the benefit of the beneficiaries. As such, any amount that the settlor puts into the trust can not be used to calculate estate taxes. Irrevocable trusts are also a great way to avoid creditors. Just as in the estate tax example, the assets of the irrevocable trust are not the property of the settlor but of the trustee. This is distinguished from revocable trusts. In revocable trusts the settlor has the right to re-enter the trust and retrieve assets.