Five Ways to Modify an Irrevocable Trust in Anaheim

Typically, conversations about trusts refer to revocable living trusts. This type of trust can be modified, updated, or revoked at any time by the person who created it. Not all types of trusts are revocable, however. Some trusts are irrevocable. They may have either been created that way from the outset, or instead, became irrevocable after a specified event occurred. Modifying an irrevocable trust in Anaheim is much more complicated than updating a revocable trust. It is not impossible, however.

California’s Probate Code allows for certain limited circumstances in which the trustee or beneficiary of an irrevocable trust can change its terms. The following are five examples of such circumstances:

  1. If all beneficiaries consent to the modification of the irrevocable trust, they can petition the court to make the change, provided the modification does not defeat a material purpose of the trust.
  2. If all of the beneficiaries and the person who created the trust consent, the irrevocable trust can be modified.
  3. If some, but not all, of the beneficiaries of the irrevocable trust consent, and the person who created the trust consents, the parties wanting the change can petition the probate court in Anaheim for the modification. The court may allow the modification if the interests of the beneficiary who does not consent are not substantially impaired.
  4. A trustee or a beneficiary of an irrevocable trust can petition the probate court to modify the trust if it has an economically low principal value as compared to the costs of administration.
  5. A trustee or a beneficiary of an irrevocable trust may petition the probate court for a modification if circumstances have changed in an unanticipated manner, and if the purpose of the trust would be defeated if it were to continue without modification.

Updating an irrevocable trust should be done under the guidance of an experienced attorney. There are many potential pitfalls to this process for the unwary. To learn more about opportunities under California law for modifying an irrevocable trust, we strongly encourage you to follow us on Facebook. 

James F. Roberts
Founder and owner of the Law Office of James F. Roberts and Associates, a premiere estate planning law firm