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Tom Meaglia, ChFC®, AEP®,


Chartered Financial Consultant

Investment Advisor Representative

Chartered Retirement Planning Counselor

CA Insurance Lic. #0567507


Meaglia Financial Consulting

2105 Foothill Blvd., #B140, La Verne, CA 91750


Toll Free: 800-386-3700

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January/February 2024

Irrevocable Trust: You Can't Take It Back

real estate agent holding house key to his client after signing contract,concept for real estate, moving home or renting property

An irrevocable trust is a trust the creator (or “grantor”) cannot change or revoke. There are two main types of irrevocable trusts. A living trust is established and funded during your lifetime. A testamentary trust is created after your death and funded from your estate according to the terms of your will. Your legal professional can draft the necessary trust documents.

Why Create an Irrevocable Trust?
Typical reasons for setting up an irrevocable trust are for wealthy individuals to minimize estate taxes; to “spend down” assets to become eligible for government programs; or to protect assets from creditors. An irrevocable trust can also help avoid probate and allow you to make arrangements in advance if you become incapacitated.

How the Trust Is Created
As the grantor, you establish the trust, designate someone to act as trustee, and name the beneficiary (or beneficiaries) who will eventually receive the trust assets. Once you have transferred assets into the trust, you surrender your ownership rights and hand over control to the trustee, who will oversee the trust and the distribution of its assets. Assets held in the trust can include cash, stocks, bonds, real estate, a closely held business, life insurance policies, and other property and investments.

The Downside of Irrevocable Trusts
Once the assets are transferred, the trust generally cannot be changed or terminated. This means you cannot remove or change the beneficiaries named in the trust, even if you no longer want a beneficiary to receive the assets. You also cannot regain control of any trust assets should you need those assets in the future.

A New Ruling
Previously, assets in an irrevocable trust received a step up in basis to their value on the date of the decedent’s death, eliminating capital gains tax. However, IRS Revenue Ruling 2023-2 states that completed gifts to grantor trusts are not eligible for a step-up in basis.

Your attorney can discuss how this ruling affects your estate plan.


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Thomas Meaglia is an Investment Adviser Representative of Coppell Advisory Solutions LLC, dba, Fusion Capital Management, a registered investment adviser that only conducts business in jurisdictions where it is properly registered, or is excluded or exempted from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. The firm is not engaged in the practice of law or accounting.
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