An irrevocable trust makes sense in three situations: you have over $12 million in assets and want tax benefits, you need to protect government benefits for a disabled family member, or you want to shield assets from creditors and lawsuits. A revocable trust is enough if you just want to avoid probate.
Reason number 1, you've got a lot of money. If you're a single person with more than $12 million or a couple with more than $24 million, then you might need a type of irrevocable trust that would benefit you from a tax standpoint. Reason number 2, you're trying to protect government benefits. If you have a child with disabilities that's on government benefits, or if you expect that you may need Medicaid benefits for long-term care, an irrevocable trust would help in those situations. Last, if you need protection from lawsuits or creditors, an irrevocable trust is the way to go. But if all you want to do is protect your heirs from getting caught up in the probate process when you die, you need a revocable trust.
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