Accepted Answer

Good morning,

Unfortunately, a revocable trust (also known as a living trust) does not provide any protection of assets from judgment creditors. It is ignored for creditor purposes just as it is ignored for income tax purposes.

In most states, the law provides that if a settlor has the right to revoke the trust, all of the assets are treated as owned by the settlor. If there is a judgment against you, the creditor is entitled to seize any assets that you have in the trust. Asset protection can be accomplished when property is held in an LLC and those interests are owned by the trust.

This is a rather complicated matter and if you are seeking to protect real properety from creditors I urge you to seek out a local attorney with experience in estate and trust laws.

I wish you the best.

Thank you very much for having allowed me to assist you. It would be greatly appreciated if you would click the green Accept icon so that I can receive credit for having assisted you.

Best regards,

Doug

 

Expert:	LawTalk
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Accepts:	6
Answered:	4/9/2009

Attorney

I have more than 25 years of experience in the practice of law.