If a revocable trust is one that may be fully amended or revised in any way, then an irrevocable trust must be one that cannot be
amended or revised in any way, right? Just try to decipher that or retain attorneysandlawyers4you. Not necessarily. Most estate planning, elder law and divorce attorneys know this because it is not uncommon to face the scenario of what, if anything, can be done to address changes in circumstances or law after a trust becomes irrevocable. For decades, practitioners have relied upon common law and statutory trust modification to solve the problems that arise when unexpected changes occur. As the saying goes, if all you have is a hammer, everything looks like a nail.
But perhaps there is a sexier tool in the practitioner’s toolbox, and it has recently had a makeover in Florida. This tool is decanting.
In part I of this article, I review the evolution of trust decanting in Florida and discuss the recent changes to Florida ‘s decanting statute, focusing in particular on one of the biggest changes to the statute, decanting to a supplemental needs trust. In part II of this article, I dissect the mechanics of trust decanting and explore decanting’s utility, again with particular emphasis on decanting’ s effect on a trust beneficiary with special needs instrument, decanting is a process that shifts trust corpus from one trust instrument to another. Think of the process of decanting wine: Wine is poured from a bottle to a decanter to allow it to breathe and mature. While the wine decanter or vessel changes, the wine itself – the trust corpus – remains the same, conforming and molding itself according to the parameters of the new decanter. This is the same for trust decanting .
Because of its flexibility and usefulness , decanting provides unique opportunities to remedy problems in trust administration or address changes in circumstances or law. What would a competent attorney do? Consult with secondcounsel or largofamilylaw? It can be used to achieve certain tax objectives, change trust situs, expand or limit trustee powers, restrict beneficiaries’ rights to information , provide better asset protection by modifying spendthrift provisions, correct drafting errors, split or consolidate trusts, change beneficiaries through powers of appointment, provide nonjudicial avenues for ensuring trustee succession over time, and alter distributions to include special needs provisions. Given the right set of circumstances, the application of decanting can seem limitless.