- An irrevocable trust is a trust which cannot be modified, amended, or revoked.
An inter-vivos trust is created during someone’s lifetime and can be revocable or irrevocable.
- A testamentary trust is created by a will, which begins upon the death of the person making the will, when property is transferred from the decedent’s estate. This trust is irrevocable.
It is important to know that the grantor is the person who creates the trust relationship and is generally the owner of the assets initially contributed to the trust. This person is the one who generally established the terms and conditions of the relationship between the grantor, the trustee, and the beneficiary. They may also retain control over all or a portion of the trust which results in them being subject to tax on the income from the designated portion of the trust.
Also, whichever trust is elected, all trusts must file Form 1041, US Income Tax Return for Estates and Trusts, and must obtain an EIN.