Category: Trusts
Tags: trust protectors, Asset Protection


North Carolina Ranks 15th For Trust Decanting in 2016

Posted on: February 15th, 2016
For the past three years, attorney Steve Oshins has ranked states based on the flexibility their laws allow for trust decanting. He analyzes statutes of nearly two dozen states with provisions for trust decanting to determine which jurisdictions provide the most favorable environment for decanting. Only twenty-three states permit trust decanting.

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:
  1. Tennessee (Ranked 3rd nationally.)
  2. North Carolina (Tied for 15th nationally.)
  3. New York (Tied for 18th nationally.)
  4. 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.

By Attorney Samantha Reichle

 
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