An irrevocable living trust is a trust that is established during the grantor's lifetime and that cannot be revoked. This means that, once the trust is finalized, it cannot be changed or cancelled.
The creators of irrevocable living trusts often place life insurance policies in them.
Many people use irrevocable living trusts to attempt to reduce estate tax liabilities in the event of a person's death and the subsequent transfer of their estate. These trusts allow them to take advantage of monetary savings when the assets are passed on to the beneficiaries. Including life insurance policies in irrevocable living trusts, then, is a way of preserving wealth and allowing it to be transferred in an efficient and safe manner.
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