Is it possible to Amend an Irrevocable Trust?

It is important that everyone 18 years of age and older have an estate plan.  It is just as important that the estate plan be periodically updated to make sure the plan meets your current desires and complies with current law.

Most common estate plan documents; e.g., a  Last Will and Testament, Durable Power of Attorney, Health Care Power of Attorney, Living Will and Revocable Living Trust, can be amended or revoked to keep the plan current.   However, one type of Trust, the Irrevocable Trust, used for different purposes, generally could not be amended or revoked.

Effective March 22, 2012, Ohio has introduced Ohio Revised Code §5808.18 to overcome the inability to amend or revoke an Irrevocable Trust.  The process is called “decanting”, and it permits the Trustee of Trust One (irrevocable) to transfer all income and principal to the Trustee of Trust Two.  Trust Two will be the updated Trust.  This will accomplish the goal of keeping the estate plan current.

Why would it be necessary to amend or revoke an Irrevocable Trust?  The reasons may include:

–        Protecting the tax treatment of a trust

–        Modifying administrative provisions of a trust

–        Change of governing law

–        Changing Trustees

Those having Irrevocable Trusts should review them to determine if any changes are necessary to keep the estate plan current.

If you have any questions about the new Decanting Statute or about your estate plan in general, please feel free to call Joseph P. Mattera, Esq. at 937-223-1130 or email him at jmattera@pselaw.com.

 

AUTHOR: Joseph Mattera
jmattera@pselaw.com


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