Such a simple question begs for a simple answer. Problem is that there is no simple answer, but I’ll give it a try.
First, you need to understand the difference between a revocable and irrevocable trust. The difference is that every word of a revocable trust can be changed, but in an irrevocable trust, there is AT LEAST one word that can’t be changed.
Nowadays, the reason elderly wants an irrevocable trust is to protect their assets from the prohibitive cost of care they need to receive at home, in an assisted living community, or a nursing home.
Most facing that challenge have heard that if your “stuff” – that’s what I call assets – is owned by an irrevocable trust, then they might qualify for Medicaid or other benefits. That’s true, but ONLY if the stuff was in there for 5 years. I don’t have enough space to explain the “5-year” rule this time, so you’ll just have to take my word for it.
So, here’s the answer to the question. Yes, you can change a revocable trust to an irrevocable trust by doing a “restatement” that is structured correctly to provide asset protection AND with a method for accessing your stuff if you need it. But if you need government assistance before the 5 years is up, the trust won’t work for its intended purpose.
The moral of the story is that if you are worried that you may want to protect your assets from long-term care costs, get an irrevocable trust NOW! Contact our firm with any questions you may have.