What it is:
A revocable trust is a trust with provisions that can be altered by the grantor. Sometimes a revocable trust is referred to as a "living revocable trust."
How it works (Example):
A trust is a legal instrument that allows property to be passed to heirs and beneficiaries without going through probate (i.e., state directed distributions of assets upon death). A revocable trust gives the full control of the assets held in the trust to the grantor (i.e., the person setting up the trust). In addition, all incomes and distributions from the assets in the revocable trust are given to the grantor during their lifetime.