Revocable Trusts vs. Irrevocable Trusts: What’s The Difference?

Shawn Plummer

CEO, The Annuity Expert

Definition and Flexibility

  • Revocable Trust: A revocable trust is a trust agreement that can be altered or terminated by the trustor during their lifetime. Trustors retain control over the assets and can make changes as needed.
  • Irrevocable Trust: An irrevocable trust, once established, cannot be altered or terminated by the trustor. The trustor relinquishes control over the assets and the trust’s terms.
Advantages Of Irrevocable Trust

Tax Implications

  • Revocable Trust: The trustor continues to pay taxes on the income generated by the trust assets, as the assets are still considered part of the trustor’s estate.
  • Irrevocable Trust: The trust itself is responsible for tax liabilities, potentially reducing the tax burden on the trustor. It can also offer estate tax benefits.

Asset Protection

  • Revocable Trust: Offers limited protection from creditors as the assets are still linked to the trustor.
  • Irrevocable Trust: Provides greater protection against creditors and legal judgments since the assets are no longer considered the trustor’s property.

Estate Planning

  • Revocable Trust: Often used for estate planning, allowing for the easy transfer of assets upon the trustor’s death without going through probate.
  • Irrevocable Trust: Also used in estate planning, especially for larger estates, to minimize estate taxes and provide for beneficiaries.
Revocable Trust Vs Irrevocable Trust


  • Revocable Trust Example: John sets up a revocable trust to manage his assets. He can change beneficiaries or trustees as his family situation changes.
  • Irrevocable Trust Example: Mary establishes an irrevocable trust for her children’s education, ensuring the funds are used for this specific purpose.

Comparison Table

FeatureRevocable TrustIrrevocable Trust
FlexibilityCan be changed or terminatedCannot be changed or terminated
Tax BenefitsLimited; taxed as part of the estateOffers potential tax savings
Asset ProtectionLimited protection from creditorsGreater protection from creditors
Control Over AssetsRetained by trustorRelinquished by trustor
Estate PlanningSimplifies transfer of assetsMinimizes estate taxes, protects assets


Choosing between a revocable and irrevocable trust depends on your individual needs for flexibility, tax implications, asset protection, and estate planning goals. A revocable trust offers more control and ease of alteration, while an irrevocable trust provides tax benefits and greater asset protection. Contact us today for a free quote.

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Frequently Asked Questions

What is the downside of an irrevocable trust?

The downside of an irrevocable trust is that the grantor cannot change or revoke it without the beneficiary’s consent.

What is one of the main advantages of a revocable trust over an irrevocable trust?

The flexibility of control.

What is the disadvantage of a revocable trust?

No asset protection.

Does a revocable trust become irrevocable at death?


How does an irrevocable trust work?

Assets transferred, no control, tax benefits.

Do all Revocable trusts become irrevocable?

Yes, upon the grantor’s death.

*Disclosure: Some of the links in this guide may be affiliate links. I may receive a commission at no cost if you purchase a policy. It helps us keep the lights on!

Shawn Plummer

CEO, The Annuity Expert

Shawn Plummer is a licensed financial professional, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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