Is an irrevocable trust a good idea?

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My 80 year old sister's health is declining and she wants to update her will/trust. Problem is, her husband is extremely difficult (cunning, manipulative, narcissitic, revengeful, etc.). This is a second marriage for both. There are 5 children between them and they are to share in whatever is left upon the demise of their parents. Problem is, my sis has a condo which is in only her name. Step-son thinks he should have access to this asset as well. She bought this with her own money as she also did with the household furnishings. Because of the extreme trust issues with both my sister's husband and step-son, she thinks it best to have an irrevocable trust to protect her interests and that of her children. Does anyone have any experience with this type of situation?

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The following should not be considered legal advice and is offered for educational/informational purposes only:

Issues surrounding second marriages and heirs can be complex and contentious and it is important that the parents come to agreement as to the disposition of their assets (not the heirs) and that proper documents then be drawn to effectuate those desires.

That being said, most spouses want the surviving spouse to have use and enjoyment of the other's assets until the demise of the surviving spouse at which point assets are divided among the heirs.

Typically this is done via the creation of a revocable trust(s) the testamentary terms of which become irrevocable at the demise of the grantor. It can also be done via Wills which then fund a trust as previously mentioned.

Medicaid considerations:

Two cautions:

1. Transfers to an irrevocable trust are subject to the famed "5 year look back" with respect to Medicaid eligibility.

2. Some states do not consider a primary residence held in a revocable trust to be an exempt asset for Medicaid eligibility purposes.

Lastly, some states have stringent "Spousal Elective Share" statutes which prevent a surviving spouse from being disinherited - usually stipulating that a minimum percentage of the entire estate be available to the surviving spouse - including those held in a revocable trust.

A competent estate planning attorney will be helpful in exploring options.


Please find and make an appointment to visit with an elder-law-attorney. The consultation is usually free. I live in New York and our elder-law attorney was very helpful. All your questions will be answered. Good luck.
Yes, I do. There were five of us siblings, and my mother had an irrevocable trust leaving all an equal share. Without that, I am certain my siblings would have cut me out. So yes, have mother put her personal assets for the benefit of her children if that is what she wants. And hurry!
I don't have experience specific to that situation, but perhaps can share some suggestions.

I assume you know that once executed, an Irrevocable Trust cannot be changed? Is there some reason you're not considering a Revocable Trust for your sister only, addressing specifically the assets she owns individually and to whom she wants to bequeath them? Or is it because she's concerned her manipulative husband might change a Living Trust without her knowledge? If so, that can't happen if she had a Trust of her own and doesn't authorize him with any authority under it.

The step-son's desires really are irrelevant - it's your sister's house.

An attorney can draft a deed that transfers her condo to her Living Trust, with provisions in a Pour-Over Will and the Trust that specifies exactly who will inherit the condo on her passing. Assuming that your relationship is good, she could also identify you as her Successor Trustee.

And BTW, I'm assuming there's no pre-nuptial agreement in place.

What document(s) specify that the 5 children share equally? If your sister doesn't want the step-son to get the condo, those documents would have to be amended as well.

Hope this helps.
You definitely need to get a lawyer involved. Some community property states DO NOT CARE if only one name is on the deed - there is an vested interest in property with any spouse if the asset was purchased during the marriage. With the issues you describe, this is definitely worth the lawyer advice, especially if Medicaid becomes involved.
I think I would see an estate planning attorney, taking for granted at this point there are no dementia issues clouding anything, and ask for his/her advice about what is best. There are way too many variables here for anyone to answer, even if they had legal knowledge in general. There is also such a thing as a 'post nup' agreement too. The other very important thing that such an attorney would do is make sure that POA's are also done, along with living wills, etc. There was an earlier question regarding whether or not a spouse is 'naturally' the trump card to a POA named to be another person. It is not. If you WANT your spouse to be POA you have to name them so, and also it's a good idea to name a back up, and there are rules about that (blood relative and/or living in the same state). Just to be clear, of course, a POA is only while the person so naming one is still living, but dementia or other events, such as a disabling stroke, could leave a black hole in the mean time. Revocable vs irrevocable has a lot to do with the amount of money involved, relationships of the parties, and how much flexibility is needed. A lot to think about but rather than asking a lawyer for this or that, tell him/her what needs to happen. They then can advise you how it should best be done.
Honestly, this is a discussion that only your mother should have with a licensed attorney. Irrevocable trusts are very nuanced (there are different types) and must be done correctly or it could have potential unintended and even disastrous consequences. Only an attorney can provide your with the proper legal advice on what is advisable for her situation based on what she wants to do with her estate. Ultimately, this has to be your mother's decision and if there is any hint of an indication that you are influencing her to include or exclude a member of the family, it could be challenged after she passes. There may be alternatives, but this is a legal question. Laws and rules regarding separate vs. community vs. quasi-community property vary from state to state. Assuming she still has capacity, she really needs a lawyer on this one. Molly Dolly is correct. Many attorneys have a free consultation just to talk options and discuss cost and your sister can then make an informed legal and financial decision.
To further reinforce this idea, your sister can visit a real estate title company and have the people she wants to have the condo added to the title as joint tenants and then quit claim deed her share to them now. Please check with an attorney or the folks at the title insurance company as the rules on this vary from state to state.
Right on Gabbygirl.
Pre-nups are not just for the rich and famous. :) Unfortunately, however, they are overlooked in scenarios such as this one. Unless they are drawn up precisely; Irrevocable Trusts can be problematic in that they cannot be amended as easily as a Revocable Trust. Some states require a court order; both time consuming and costly. If the condo was purchased prior to the marriage, it shouldn't be an issue. It is held as a separate asset. An attorney should really be consulted. When considering any possible transfer of Real Property prior to death; please also bear in mind that this may effect Capital Gains Tax in the future as the 'step up in basis' may be lost. Good luck.

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