The Times Herald (Norristown, PA)
Some advice and information about trusts
Sometimes our office receives a call with a question like “I need an irrevocable trust. Can you do that?” My immediate response is “Why do you believe you need an irrevocable trust?” The reason might be the caller heard or read that irrevocable trusts can shelter residences for Medicaid purposes or avoid creditors or protect assets from law suits.
What really is needed is a solution to a problem. I compare the question to calling a physician’s office and saying “I need an appendectomy. Can you do that?” The complaint might be pain in the side and the questioner might have read on WebMD that the likely cause is appendicitis. A trust is one tool in a toolbox. The real question is how do I arrive at a given result. One of the services our office performs is walking clients through alternatives so they can make informed decisions to arrive at their desired result. They might consider an irrevocable trust or have available to them some other Medicaid planning tool such as a Medicaid exemption. They might establish a spendthrift trust in a will to protect assets or a revocable living trust.
Trusts may be irrevocable or revocable. They might be socalled grantor trusts or nongrantor trusts. They might be established only to provide more detailed instructions than might be contained in a typical will although wills can be tailored to the circumstances. They might be needed to deal with special needs or a beneficiary with substance abuse problems or serious difficulties with creditors. They might take effect during lifetime or only on death and be contained in a will, a so-called testamentary trust.
One of the questions that arises during discussions is whether a trust, once established, can be changed. Can a revocable trust become irrevocable? As with most legal questions, the answer is “it depends.”