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In developing an estate plan, practitioners regularly use irrevocable trusts (versus the typical revocable living trust) to assist clients in achieving tax and non-tax estate-planning goals.1 Irrevocable trusts are used during life most often for estate tax planning to remove the fair market value (FMV) of the trust property from the grantor’s gross estate (GE) for federal estate tax (FET) purposes.
Irrevocable trusts are also created as subtrusts (for estate and generation-skipping transfer tax purposes or for other reasons) under revocable trusts when the grantor of a revocable trust passes away. Regardless of the tax planning sought to be achieved by irrevocable trusts, they can help a client achieve numerous other goals. Two signific...
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