Trust Modifications: I assume a settlor or creator of a trust can make changes to a trust document. Is this always true? Or is there such a thing as a irrevocable trust that even the settlor cannot change?
The person who sets up a trust is called a grantor, settlor, or trustor. That person can only change a trust if the power to change the trust was reserved in the trust document. The most common of these trusts is the revocable living trust frequently used to manage assets through disability or avoid probate. If the trust is not revocable, i.e., it cannot be changed, it is called irrevocable. In an irrevocable trust unless there is an express power for the grantor to change the document he or she cannot do so. Most irrevocable trusts carefully limit, and often expressly prohibit, any modifications by the grantor. This is often done to better protect the assets from claimants and better assure that the assets will be taxed outside of the grantor's estate. However, some powers can be reserved to a grantor such as the right to replace an independent (not subservient or subordinate) or institutional trustee with another independent or institutional trustee. To determine precisely what an existing trust permits the grantor to do, review the document with a trust and estate attorney. To determine what you can include in a new trust by way of powers for the grantor, consult with an estate planner. Also, different state laws provide different degrees to which you can have some retained rights, so the state where the trust is based (situs) can be important.
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