What characterizes an irrevocable trust?

An irrevocable trust is characterized by its inability to be changed or terminated by the grantor after it has been established. Once the trust is created, the assets that are placed into the trust are no longer owned by the grantor, which significantly limits their ability to modify the terms of the trust or reclaim those assets. This is a key feature that distinguishes irrevocable trusts from revocable trusts, where the grantor retains the ability to make changes.

Additionally, because the assets in an irrevocable trust are removed from the grantor’s control, they may be protected from creditors and can have advantages in estate planning, such as potential estate tax benefits. However, the central defining trait here is that the trust cannot be altered, ensuring that the original intentions of the grantor regarding asset distribution and management are upheld without the risk of future changes.