44 The QUEE NS Courier • business • november 14, 2013 for breaking news visit www.queenscourier.com ▶business ▶The Elder Law Minute TM Decanting to ‘Rewrite’ an Irrevocable Trust By Ronald A. Fatoullah, Esq. and Yan Lian Kuang-Maoga, Esq. On September 30, 2013, Nassau County Surrogate’s Court ruled in favor of a trustee who had exercised the power to transfer assets of an irrevocable trust into a new trust, i.e., a supplemental needs trust, for a disabled beneficiary. This action protected the disabled trust beneficiary’s assets, while preventing him from losing his governmental benefits. The case brings attention to the use of New York’s “decanting” statute to basically rewrite an irrevocable trust when circumstances have changed. An irrevocable trust, whether it was created as irrevocable, became irrevocable after the death of the creator elder law of a revocable trust, or was created under a decedent’s Last Will and Testament, is a trust that cannot be changed. However, in life, everything is subject to change. Therefore, as time passes and circumstances change for the beneficiaries of an irrevocable trust, it is not uncommon to see that the terms of a trust are no longer beneficial and may even be detrimental to the beneficiary and contradictory to the original intent of the creator. The decanting statute allows a trustee, under certain circumstances, to transfer the trust assets into a new irrevocable trust. This generally can be done without the involvement of a court. This power is exercised by executing a written instrument signed, dated, and acknowledged by the trustee. Unless all interested parties consent to the new trust in writing, all interested parties must be served with notice and the decanting becomes effective only once 30 days have passed since the date of the notice. In the aforementioned case, the irrevocable trust gave the disabled beneficiary the right to withdraw all the principal of the trust (approximately $400,000) upon reaching the age of 21. The creator of the trust was the disabled beneficiary’s grandfather. The trust had been created when the beneficiary was only 19 months old and had no noticeable disability at the time. The beneficiary was later discovered to suffer from several disabilities and thus became the recipient of government benefits. The right to withdraw principal from the trust when the beneficiary turned 21 would have jeopardized his continuing eligibility for benefits, and would have frustrated the original intent of the creator. The trustee therefore used the guidelines of the decanting statute and transferred the trust assets into a supplemental needs trust. The assets provided by the creator in the new supplemental needs trust will continue to be available for the benefit of the disabled beneficiary but will not jeopardize the beneficiary’s continuing eligibility for government ROnald Fatoulah, ESQ, CELA* benefits. The assets will be available to supplement the beneficiary’s needs for the rest of his life and any remaining assets will be disbursed to the creator’s intended remainder beneficiaries, not to the government. The decanting statute is available for trustees to consider using when circumstances of the beneficiaries change and the terms of the trust are no longer appropriate. The trustee in this recent case used the statute to protect a beneficiary who had become disabled. This may be an option for a beneficiary who has been shown to be unable to, or should not, manage funds. A trustee should seek legal advice to assess all available appropriate options. Ronald A. Fatoullah, Esq. is the principal of Ronald Fatoullah & Associates, a law firm that exclusively concentrates in elder law, estate planning, Medicaid planning, special needs, guardianships, trusts and wills. The firm has offices in Forest Hills, Great Neck, Manhattan, Brooklyn, and Cedarhurst, NY. This article was written with the assistance of Yan Lian Kuang- Maoga, an elder law attorney with the firm. Ronald Fatoullah & Associates can be reached by calling (718) 261- 1700, 516-466-4422, or toll free at 1-877-ELDER-LAW or 1-877-ESTATES. Dragon boats give back As this year’s participants of The Hong Kong Dragon Boat Festival in New York (HKDBF-NY) will receive thousands of dollars ANE M. DUNE JOINS ADVANTAGECA RE PHYSICIANS Anne M. Dunne, RN-BC, MBA has joined AdvantageCare Physicians as Regional Vice President of Operations. AdvantageCare Physicians is one of the largest multi-specialty physician practices in the New York metropolitan region. It has more than 400 primary care physicians and specialists in 39 convenient locations in Manhattan, Queens, Long Island, Brooklyn and Staten Island, offering an expansive complement of primary and specialty care services. Dunne is accountable for the Queens and Long Island region, with offices spanning from Astoria to Ronkonkoma. AdvantageCare Physicians is innovating how health care is delivered. Its coordinated and collaborative team approach, which is based on nationally accredited standards, ensures that every patient receives, «bestin class» care. Immediately prior to joining AdvantageCare Physicians, Dunne served as Director of the Healthcare Management Consulting Group for Grassi & Co., where she worked with multiple physician and academic practices to improve operational, financial and clinical efficiencies. Previous positions include Senior Vice President of Clinical Service Development for a privately held company and Operations Officer for a large multispecialty neuroscience center serving Long Island. Dunne served as a consultant to a privately held imaging facility and an occupational health service company which provided preemployment and annual health assessments to healthcare workers in the five boroughs. for the charities of their choice, the city begins to prepare for next year’s boat race. On behalf of the HKDBF-NY 2013 Charity Boat Race, which took place on August 11, participants’ $7,500 will be awarded to the charities of their choice. This year’s race included teams from HSBC Bank USA, DCH Auto Group and Shanghai Commercial Bank LTD. Each company contributed $2,500. DCH Auto Group, this year’s Charity Boat Race winner, receives $3,500, half of the funds raised, and will donate the money to the Charles B. Wang Community Health Center. Runner-up HSBC Bank receives $2,000 for the Chinatown YMCA, and second runner-up Shanghai Commercial Bank gets $2,000 for the Museum of Chinese in America. The Hong Kong Dragon Boat Festival in New York is an annual sporting event and largest multi-cultural celebration in New York which takes place over two days in Flushing Meadows-Corona Park. It is also the biggest festival of its kind in the country. This year’s race attracted 188 teams to participate, the largest number of teams in the past 23 years, with 2,500 participants competing. The tentative dates for the 2014 Hong Kong Dragon Boat Festival will be an opening day parade on Saturday, August 9 and the U.S. Dragon Boat Open Championship Race on Sunday, August 10.
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