Florida Asset Protection Trusts: Can they be changed?
In Florida, both revocable and irrevocable trusts are valuable estate planning tools that permit individuals to organize and protect their assets from creditors. The Florida Asset Protection trust is not used by many estate planning lawyers. Asset Protection is an important part of estate planning in Florida. While the name irrevocable would seem to indicate that the trust cannot be revoked, there are many ways of accomplishing the same effect as revoking a trust.
Generally when one discusses revoking a trust, they are referring to doing one of the following:
- Changing a term in the trust
- Changing the plan of distribution or the beneficiaries named in the trust.
- Changing the managers in the trust- the trustee
- Changing the co-trustee in the trust
- Changing the assets in the trust
Of course there is also rate case when the need for a trust no longer exists. The creator of the trust may simply want to discontinue the existence of the trust and retain individual ownership of the assets. We find that most people who want to revoke a trust are mistaken in their reasoning. Some people would like to revoke an irrevocable trust for a legitimate reason. One example is a life insurance trust where the beneficiary no longer needs the insurance.
Florida law permits judicial modification and non-judicial modification of irrevocable trusts which may solve many problems that may arise in the future. An even better solution is to permit changes in the trust, when estate tax is not a consideration, and permit the original creator of the trust to make the changes directly. Many of the irrevocable trusts we create permit the settor ( the creator) to make changes to the beneficiaries, trustees, successor trustees, and assets in the trust.
In some cases the beneficiary can be a spouse so the entire trust can be undone without any consequences if necessary. You should speak with an estate planning and asset protection lawyer about the new breed of irrevocable trusts that offer far greater flexibility than traditional Irrevocable trusts. An irrevocable trust or more specifically a Florida Asset protection trust can be designed to offer asset and medicaid protection while a revocable trust offers neither.