The Vocabulary of Trust - 07/14/10 03:40 PM
The use of trusts in asset protection is quite popular but the distinctions between a revocable and irrevocable trust are important to understand. In an irrevocable trust, possession of the asset is transferred to an independent trustee; the original possessor is no longer tied to them. Thus, for 1031 exchange purposes the irrevocable trust has a separate tax identification number. Therefore, in compliance with the same taxpayer rule, a revocable trust can be used interchangeably with personal ownership but an irrevocable trust cannot.
For a table depicting the differences, click here.
 
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James Brennan, JD/LLM, 1031 Exchanges

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