The Facts: I created an irrevocable trust a number of years ago. However, my circumstances have changed dramatically and the trust no longer suits my needs. I want to revoke the trust and sell the assets that are in the trust.
The Questions: Although the trust is irrevocable, is there a way it can be revoked?
The Answer: Fortunately for you, there are circumstances when an irrevocable trust can, in fact, be revoked. If your needs and goals have changed to the point that the trust no longer serves a useful purpose, you may want to amend or revoke the trust. Whether you are able to do so will depend on the language of the trust document itself and the cooperation of the beneficiaries. Generally, if all of the beneficiaries are of legal age and competent, they can sign a document giving their consent to the amendment or the revocation of the trust. The beneficiaries’ signatures must be notarized for the amendment/revocation to be effective. If any of the beneficiaries are minors, you will not be able to amend or revoke the trust since minors cannot legally give consent.
Assuming that you are able to revoke your trust, you will also have to change the title on any trust assets such as real property or motor vehicles that have recorded titles. Accounts held by the trust will also need to be retitled if the trust is revoked. This may or may not need to be done if you simply amend the terms of the trust without removing trust assets.
When amending or revoking a trust, it is very important that the document setting forth the changes to be made to the trust properly identify the trust and the beneficiaries. It is also important that all trust assets be accounted for and properly retitled when appropriate. To avoid mistakes and problems down the road either with an unhappy beneficiary or with assets that are still held by a trust that no longer exists, it is best to retain the services of an attorney with experience creating and revoking trusts.
Linda M. Toga provides personalized service and peace of mind to her clients in the areas of wills and trusts, estate planning and estate administration, marital agreements, small business services, real estate and litigation. Visit her website at www.lmtogalaw.com or call 631-444-5605 to schedule a free consultation.