An irrevocable trust is generally thought of as a trust to which changes cannot be made. While this offers greater protection to the assets in the trust, it also means that if circumstances change, a person may be stuck with a trust that is no longer useful. However, a number of states, including Georgia, offer a “decanting” option to change an irrevocable trust if necessary.
There are many reasons a person might want to do this. Parents who created an irrevocable trust for a child may believe that as an adult, that person is not responsible enough to manage distributions effectively. People may also decide they want to extend the term of a trust or change it to help a relative with special needs. If it is a support trust, they may want to change it to a discretionary trust with the added protection from creditors or during divorce that such a trust offers. Other reasons to change an irrevocable trust include making the trust more efficient or avoiding state income tax with a change to the governing law.
Some states have strict regulations for decanting. If a person wishes to bypass these regulations, it might be possible to move the trust to another state with more flexible laws. The trust must have a “change of situs” provision for this to be possible.
Another option is simply to use a revocable instead of an irrevocable trust, and in some cases, a revocable trust may be sufficient for a person’s goals. Trusts can operate in a variety of ways: They may benefit charities while also providing income to beneficiaries, help protect wealth across generations and allow for a more private estate plan among other functions. A person might want to discuss their estate plan with an attorney to determine which type of trust would be appropriate.