How Do Trusts Help You Save on Taxes? Many people come to us curious (or confused) about trusts and taxes. So, today’s article is going to sort it out and clarify things for you. There are two types of trusts, and each have different tax consequences. Revocable trusts, which are the far more commonly used trusts, have no tax consequences whatsoever. A revocable trust has your social security number as it’s tax identifier, and is not a separate entity from you for tax purposes. It is a separate entity from you for purposes of probate, meaning if you become incapacitated or die your Trustee can take over without a court order, keeping your family out of court. But, until your death, it’s treated as invisible from a tax perspective. At the time of your death, if your revocable trust provides for the creation of irrevocable trusts, then the tax implications will shift. When you have an irrevocable trust, either created during life, at death through a revocable livin...