How Do You Change An Irrevocable Trust?
There are two standards to consider with regards to an irrevocable trust. The IRS has the stricter standard: they consider any trust in which the grantor retains any meaningful control of or interest in the assets, or the power to change the beneficiaries or trustee, to be a grantor trust, and taxable to the grantor. Thus, an irrevocable trust under state law might not be treated as such by the IRS, which carries important income and estate tax implications. While it is not possible for anyone but the beneficiary to alter the terms of an irrevocable trust, there are some creative ways for a grantor to change an irrevocable trust depending on the terms of the trust itself. Get the beneficiaries to agree. The most common and direct way an irrevocable trust is changed is through agreement by the beneficiaries. This must be done according to the laws of the state governing the trust and must be approved by a state court (often before a probate judge). All the beneficiaries, including those