While irrevocable trusts tend to make some grantors uneasy, as they associate an irrevocable trust with words such as irreversible, final, and unalterable, the truth is, it is possible in some instances to revoke an irrevocable trust.
Cases to Support an Irrevocable Trust
A trust and estate planning lawyer will ease your concerns about an irrevocable trust by informing you of statutory provisions that allow you to make provisions to your trust.
In the event a grantor of an irrevocable trust has gifted money to a beneficiary at a specific age, it is sometimes wise to be allowed a provision to alter that trust. If a beneficiary is showing signs that inheriting the money at the specified age could be detrimental, cause harm, or risk losing the inheritance, the grantor may be allowed to transfer that money to another trust. This provision not only protects the beneficiaries’ inheritance, but it also assures the guarantor his wishes will be respected.
In the event the trustee of a trust needs to be changed, or perhaps the terms of the trust will be frustrated if the trust continues, you may want to consider meeting with a lawyer to discuss your options. There are many reasons that a trust may need to be revoked of modified.
For a thorough understanding of how an irrevocable trust can be used toward your benefit, it is best to contact an experienced trust and estate planning attorney with knowledge of how the laws relate to your situation.
How Can We Revoke an Irrevocable Trust?
The first action should be to consult a lawyer with experience in trust and estate planning and specifically revoking an irrevocable trust. An attorney will help you to understand whether it allows for modification, and what circumstances it allows for a modification.
If it does not allow it, you have a few options to petition the court:
- Changed Circumstances: If you are the trustee and the grantor is still alive, refer to the document itself for specific instructions on revoking the trust and returning the assets to the grantor.
- Mutual Consent of Modification: Should the trustee and all beneficiaries unanimously agree to revoke the trust, they can file a consent modification. To learn more about a consent modification, watch this video on Modifying an Irrevocable Trust.
- Non-Consenting Modification: If the settlor and only some of the beneficiaries consent to a modification, the matter may be petitioned to an appropriate court where it should be demonstrated that the non-consenting beneficiary(ies) may not be impacted.
Consult Mendes Weed, LLP for Your Trust and Estate Planning Needs
Planning for the future is an important task, and modifying an irrevocable trust needs careful consideration. While revoking a trust may grant you increased flexibility and control over some issues, it could have repercussions you were not expecting.
Be aware of any tax consequences related to modifying or revoking an irrevocable trust. It is worth the time and consideration to consult with an experienced trust and estate planning lawyer if you are thinking of revoking an irrevocable trust.
Mendes Weed, LLP has been helping clients with their trust and estate planning needs, and we would like to help you, too. We have offices in Walnut Creek, Sacramento, and San Francisco. Please contact us today.
Disclaimer: The tips and materials provided on this page are for informational purposes only, offered as public service. No information on this website should be considered legal advice or used as a substitute for legal advice. For legal advice, you should contact an attorney directly.