What is Irrevocable Trust Drafting?
An irrevocable trust is a legal arrangement for permanently moving assets into a trust. The trust terms are included in a trust deed or agreement.
Read the rest of this article for clarity about what key terms to know about in irrevocable trust drafting, how to draft the agreement professionally, and how a qualified lawyer can assist you, giving you peace of mind that the trust reflects your wishes.
What are Key Terms in an Irrevocable Trust?
An irrevocable trust document usually contains the following information:
- Intent and parties. Provide information about the trust’s purpose, its trustee, and its beneficiaries.
- Assets. List all the assets that will be moved into the irrevocable trust, with clear titles.
- Compliance. The trustee must fulfill all their duties, such as ensuring distributions are made according to specific deadlines.
- Amendments. Specify if any changes can be made to the trust, and how.
- Execution. To properly execute the trust, include signatures and notarization where appropriate.
What are Tips for Irrevocable Trust Drafting?
When drafting an irrevocable trust document, there are some things to consider so that all terms are clear and legally valid.
Define Clear Goals
You want to stipulate the purpose of the irrevocable trust before writing its terms. This provides context and is usually written in the “Purpose and Intent” section of the trust document.
Select a Reputable Trustee
Mention in the trust document who is named as the trustee. Make sure you select a person who is reliable, neutral, and independent. This will help you to avoid conflicts of interest.
It’s advisable to mention what will happen if a trustee resigns, dies, or needs to be removed so that you prevent confusion.
Detail Distribution Rules
Your trust document must specify exactly how the distributions will be provided to beneficiaries. Explain how, when, and under what conditions distributions are applied.
Include Some Flexibility
Although an irrevocable trust can’t be changed easily, you can include some legal provisions to change it, such as if the laws surrounding it change. A lawyer can assist you with this.
Outline the Trustee Authority
You want to clarify what the trustee will do for the irrevocable trust, such as their ability to purchase and sell property, distribute to the beneficiaries, and manage the trust. Be specific so that all parties have clarity about their obligations and tasks.
State the Duration and Termination
Specify the date on which the trust estate is distributed fully, what event requires termination, and what happens after it’s terminated. For example, specify if the trustee will distribute the remaining trust estate to specific beneficiaries, subject to the applicable law.
Do You Need a Lawyer to Draft an Irrevocable Trust?
There are many aspects involved in drafting an irrevocable trust. This is why it’s advisable to hire a lawyer to draft an irrevocable trust agreement for you.
A lawyer will assist you in various ways, such as by:
- Identifying the parties involved, such as the grantor, trustee, and beneficiaries.
- Clarifying the trust purpose and intent.
- Identifying the assets that will be transferred to the trust.
- Clearly stating that the trust is irrevocable. This can include stating that the grantor can’t revoke the trust property.
- Setting a term and termination for clarity. They’ll help you establish how long the trust will continue and under which circumstances it can be terminated.
- Explaining the trustee’s powers and duties. They’ll consider their authority to ensure that the trust is managed properly.
- Simplifying the distribution terms. A lawyer will explain when and how the trustee will distribute income to the beneficiaries and what the beneficiaries rights are, such as their right to receive information or updates from the trustee.
- Considering accounting duties. This is something you might forget about when drafting an irrevocable trust. A lawyer will outline whose responsibility it is to maintain financial records and reports.
- Navigating amendments. It could happen that the trust needs to be changed. A lawyer will explain how the trust’s provisions can be changed, who has authority to change them, and under what circumstances they can be modified.
- Reviewing the irrevocable trust document. If your document has been drafted, you should hire a lawyer to review it for you so that you’re happy with everything it contains.
Where to Find and Hire a Lawyer for Irrevocable Trust Drafting
If you need to hire a reputable lawyer to draft an irrevocable trust document, you don’t have to struggle to know where to find one. Online legal marketplaces such as ContractsCounsel make finding and hiring an experienced lawyer a fuss-free process.
ContractsCounsel is one of the largest online marketplaces that gives you access to a curated network of lawyers who are experienced in contract drafting. To request that a lawyer drafts your irrevocable trust document, here are the easy steps to follow:
- Go to the ContractsCounsel marketplace, where it’s free to post a request or project.
- Select ‘One-time project’ and ‘Create or update contract.’ Alternatively, select ‘Contract review.’
- Post your project, including some details of what you require so you can match with the most suitable lawyers.
- Wait for bids. After posting your project, you’ll receive multiple bids from lawyers directly on the platform who are ready to assist you.
- Review the lawyer data provided by the platform. This includes their location, field of expertise, years of experience, credentials, and client ratings for previous projects completed on the platform.
- Select a lawyer who meets your requirements and hire them to draft your irrevocable trust for a flat fee.
