As time passes, circumstances change. Births, deaths, and divorces occur, fortunes are made and lost, health improves and deteriorates, and laws change. The creator of an irrevocable trust (called the “settlor”) might not have anticipated that changes in the tax laws would make inclusion of assets in his/her surviving spouse’s estate for estate tax purposes more beneficial than exclusion or that his/her child or grandchild would have special needs. In these kinds of situations, it can make sense to alter the terms of the trust.
Some trust documents have built-in mechanisms for making changes to the trust’s provisions. Trust protectors and powers of appointment are among the more common mechanisms. Many other trust documents do not contain such mechanisms. Virginia's Uniform Trust Code, which generally supplements the terms of a trust, allows the modification and termination of irrevocable trusts under certain circumstances.
I recently gave a presentation to the Fairfax Bar Association's Wills, Trusts & Estates Section (i.e., a group of lawyers) on modifying and terminating irrevocable trusts under Virginia's Uniform Trust Code. The complete materials from the presentation are available here.