Trust decanting is a process that allows assets of a trust to be distributed to another trust with different terms; generally the newer trust offers terms that better satisfy the needs of the beneficiary. Some states impose burdensome administration requirements for trust decanting, while others offer easier means of use. The 2016 Trust Decanting State Rankings Chart places North Carolina in a tie with Kentucky for 15th in the nation.
In addition to North Carolina, the other three states our estate planning and asset protection attorneys serve also ranked nationally. Here’s how they placed for 2016:
- Tennessee (Ranked 3rd nationally.)
- North Carolina (Tied for 15th nationally.)
- New York (Tied for 18th nationally.)
- Florida (Ranked in last place, 23rd nationally.)
Irrevocable trusts (documents that become permanently binding upon their execution) provide a certain level of control over trust assets. However, circumstances and needs change over time, and the lack of flexibility associated with irrevocable trusts could create complications. Depending on the powers and limitations of the jurisdiction, trust decanting offers an opportunity to change the terms of an irrevocable trust. When decanting is not available, a trust protector might provide another avenue to amend an irrevocable trust.
Learn more about trust decanting in North Carolina.
By Attorney Samantha Reichle