An irrevocable trust is a trust that by its terms is not subject to any ability to be revised or revoked by the creator of the trust. In that regard, note that a trustmaker may still hold and exercise certain retained rights over the trust or trust property without negating its status as irrevocable, so long as the rights in question were present in the governing trust instrument at the time the trust was created. In order to make a trust irrevocable, it is the ability to change the terms or completely disestablish the trust which cannot be present.
Irrevocable trusts tend in general to be used for specific purposes. A very much incomplete but illustrative list of examples of such purposes would be minimizing estate taxes, providing asset protection, or making a gift of assets to benefit a special needs beneficiary without disqualifying him or her from eligibility for means-tested government benefits that he or she may need and depend on. Under the right circumstances, irrevocable trusts can be incredibly useful tools. With careful drafting, in many cases they can even help to achieve multiple, seemingly mutually exclusive objectives at the same time. But for obvious reasons, they need to be drafted and funded with a high degree of care and attention to detail.
In extraordinary circumstances, there are procedures which can be invoked in order to modify or even terminate an irrevocable trust. Such procedures require much more than the unilateral action of the trustmaker, such as a non-judicial settlement agreement, action by a duly appointed trust protector, or a court order. We are sometimes called upon to help with these kinds of tasks, especially when modification is necessary to carry out the trustmaker’s original intent in light of subsequent developments like unanticipated changes in the law or other circumstances.
If you have questions about the potential benefits of an irrevocable trust, or the possibility modifying an existing irrevocable trust, feel free to schedule an initial consultation.