The Proliferation of Trust Decanting Statutes Continues

more+
less-

Irrevocable trusts are now subject to varying degrees of amendment by court approved modifications, trust protector actions, private settlement agreements, and, of course, decanting.

Effective July 1, 2013, Wyoming will become the nineteenth state (and the ninth state since 2010) to permit trust decanting by statute. Decanting refers to the distribution of trust property of one trust to a second trust. Historically, the availability of decanting and its limitations were not clearly defined by case law. Today, state statutes are filling this void by expressly authorizing decanting within clearly defined boundaries.

While the ability to modify an irrevocable trust provides great flexibility for planners, such modifications should not be made without careful consideration and sound legal advice. The act of decanting, in particular, can expose trustees to fiduciary liability and/or trigger undesirable income, gift, estate and generation-skipping transfer tax results.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© BakerHostetler | Attorney Advertising

Written by:

more+
less-

BakerHostetler on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:

Sign up to create your digest using LinkedIn*

*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.
×
Loading...
×
×