Thinking About Decanting a Trust in Florida? Start With the Right Questions

Can a trust be decanted in Florida? Yes, but only when the statute and the trust’s own terms allow it. Decanting means an authorized trustee, meaning a trustee other than the settlor or a beneficiary who has the power to invade the principal of a trust, moves trust assets into a second trust with different terms. The rule is in Fla. Stat. § 736.04117, and it applies unless the trust instrument expressly provides otherwise. Under Fla. Stat. § 736.04117(2)(a), unless the trust instrument expressly provides otherwise, an authorized trustee who has absolute power to invade a trust’s principal may exercise that power by modifying the first trust or by appointing principal to a trustee of one or more other trusts, for the current benefit of one or more beneficiaries, but only if the statute’s conditions are met, beginning with the requirement that the beneficiaries of the second trust include only beneficiaries of the first trust.

It also shows how decanting differs from other changes to an irrevocable trust, and where beneficiaries raise challenges. Leslie V. Marenco is the responsible lawyer for this page.

What Decanting Means for an Irrevocable Trust

Decanting is an authorized trustee’s move of trust assets, under a power to invade principal, into a new trust with different terms. The name comes from pouring liquid from one container into another.

An irrevocable trust is hard to change. Decanting gives a trustee another route, but only when the law gives that trustee the power.

Decanting matters most when a trust’s terms no longer fit the family’s needs. Families often find that a trust was written for circumstances that have since changed. Whether decanting is possible turns on the trust language and the statute.

For wider context on trust disputes, read our trust litigation attorney page. Trust Counsel, PL represents beneficiaries, heirs and fiduciaries in probate and trust disputes.

Florida’s Decanting Statute

Florida’s decanting power is set out in Fla. Stat. § 736.04117. The statute uses precise terms, so read the wording before relying on any summary.

The statute defines an “authorized trustee” as a trustee, other than the settlor or a beneficiary, who has the power to invade the trust’s principal. Principal is the core property held in the trust. The trustee can exercise the power by changing the first trust’s terms. Fla. Stat. § 736.04117 reads: “Unless a trust instrument expressly provides otherwise, an authorized trustee who has absolute power under the terms of the trust to invade its principal, referred to in this section as the “first trust,” to make current distributions to or for the benefit of one or more beneficiaries may instead exercise such power by modifying the terms of the first trust or by appointing all or part of the principal of the trust subject to such power in favor of a trustee of one or more other trusts, whether created under the same trust instrument as the first trust or a different trust instrument, including a trust instrument created for the purposes of exercising the power granted by this section, each.” The trustee can also move all or part of the principal to a trustee of a second trust, but only if the beneficiaries of the second trust include only beneficiaries of the first trust. Fla. Stat. § 736.04117 reads: “Unless a trust instrument expressly provides otherwise, an authorized trustee who has absolute power under the terms of the trust to invade its principal, referred to in this section as the “first trust,” to make current distributions to or for the benefit of one or more beneficiaries may instead exercise such power by modifying the terms of the first trust or by appointing all or part of the principal of the trust subject to such power in favor of a trustee of one or more other trusts, whether created under the same trust instrument as the first trust or a different trust instrument, including a trust instrument created for the purposes of exercising the power granted by this section, each.”

The statute splits the rules by the kind of power the trustee holds. An “absolute power” is one not limited to specific or ascertainable purposes. A power for “best interests, welfare, comfort, or happiness” counts as absolute. A power limited to purposes such as health, education, maintenance and support is not absolute. That split matters because each path carries its own beneficiary rules.

Who Holds the Power and Who Must Be Told

That trustee cannot be the settlor or a beneficiary.

Unless the trust instrument expressly provides otherwise, when the power is absolute, the second trust may benefit only beneficiaries of the first trust. Unless the trust instrument expressly provides otherwise, when the power is not absolute, the second trusts, taken together, must give each beneficiary interests substantially similar to that beneficiary’s interests in the first trust. The statute also has a separate path for a beneficiary with a disability, allowing a move into a supplemental needs trust.

Notice for a decanting comes from the same statute: under § 736.04117(8), the authorized trustee must provide written notification of the manner in which he or she intends to exercise his or her power to invade principal, at least 60 days before the exercise takes effect. Fla. Stat. § 736.0813 separately requires a trustee to notify qualified beneficiaries within 60 days after learning that an irrevocable trust was created, or that a formerly revocable trust has become irrevocable, whether by the settlor’s death or otherwise.

Trust Counsel’s attorneys can serve individually as trustee or personal representative. The firm advises and represents trustees, personal representatives and beneficiaries.

Decanting Compared With Amending, Modifying or Ending an Irrevocable Trust

Decanting is only one route, and each route has its own rules. Each one answers a different question about changing a trust.

Nonjudicial modification happens without a court. After the settlor’s death, the trustee and all qualified beneficiaries must agree unanimously, under § 736.0412, but this section does not apply to any trust created prior to January 1, 2001, or to certain other trusts listed in the section. Under § 736.0410, any beneficiary may start a proceeding to disapprove a proposed modification of that kind.

Judicial modification needs a court. Under § 736.04113, a court may modify a trust when its purposes are fulfilled or have become impracticable. The same section covers unanticipated circumstances that defeat a material purpose. Under § 736.04115, upon the application of a trustee or any qualified beneficiary, a court may also modify a trust that is not then revocable when following the terms is not in the beneficiaries’ best interests, but this section does not apply to any trust created prior to January 1, 2001, or to certain other trusts described in the section.

Nonjudicial settlement agreements under § 736.0111 can resolve many trust matters among interested persons. They are valid only to the extent a court could approve the same terms.

Whether a trust can be revoked turns on whether it is revocable at all. Under § 736.0813, a trustee’s duties run only to the settlor while a trust remains revocable. Changing an irrevocable trust can involve modification, decanting and court involvement. Not every estate needs a trust, so the choice rests on the family’s goals and assets.

What “Invaded Trust” Means in Searches

People who search “invaded trust” usually mean the trust that loses assets in a decanting. The statute speaks of a trustee’s power to invade principal.

The statute refers to the original trust as the “first trust,” and it defines terms such as “authorized trustee” and “current beneficiary” (Fla. Stat. § 736.04117). The “first trust” is the original trust. The “second trust” receives the assets and carries its own terms, trustee and beneficiaries. Fla. Stat. § 736.04117 reads: “Unless a trust instrument expressly provides otherwise, an authorized trustee who has absolute power under the terms of the trust to invade its principal, referred to in this section as the “first trust,” to make current distributions to or for the benefit of one or more beneficiaries may instead exercise such power by modifying the terms of the first trust or by appointing all or part of the principal of the trust subject to such power in favor of a trustee of one or more other trusts, whether created under the same trust instrument as the first trust or a different trust instrument, including a trust instrument created for the purposes of exercising the power granted by this section, each.” Each trust raises its own questions, so a reader should review both.

The statute also says it does not cut back the right of any trustee who has a power of invasion to appoint property in further trust. Those rights can come from the trust terms, other parts of the trust code, other law or common law.

Where Decanting Leads to Disputes

A decanting can be challenged when a beneficiary believes the trustee broke a duty. Under § 736.0802, a trustee must administer the trust solely in the beneficiaries’ interests. Under § 736.0804, a trustee must act as a prudent person would, using reasonable care, skill and caution.

When a violation is a breach of trust, § 736.1001 lists the court’s remedies. A court may compel the trustee to redress the breach, order an accounting, remove the trustee or reduce the trustee’s compensation. A court may also void an act of the trustee or impose a lien or constructive trust on trust property.

Time matters. For matters adequately disclosed in a trust disclosure document, § 736.1008 bars a beneficiary’s claim unless the proceeding starts within 6 months. Under Fla. Stat. § 736.1008, a beneficiary is barred from bringing an action against a trustee for breach of trust on a matter adequately disclosed in a trust disclosure document unless a proceeding is commenced within 6 months after receipt of that document or of a limitation notice that applies to it, whichever is received later. Under Fla. Stat. § 736.1008, unless sooner barred by adjudication, consent, or limitations, a beneficiary is barred from bringing an action against a trustee for breach of trust on a matter adequately disclosed in a trust disclosure document unless a proceeding to assert the claim is commenced within 6 months after receipt of that disclosure document or of a limitation notice that applies to it, whichever is received later (Fla. Stat. § 736.1008).

Trust Counsel, PL represents beneficiaries, heirs and fiduciaries in probate and trust disputes. A review of the instrument, the notices and the distributions often happens together.

Questions to Ask Before a Decanting Moves Forward

Start by gathering the trust instrument, any amendments, the decanting document, every notice you received and any record of changed distributions. Note the trustee’s stated reasons and write down the date each document arrived.

Timing can matter. The 6-month period in § 736.1008 runs from the later of receipt of the trust disclosure document or receipt of a limitation notice that applies to it, so proof of arrival dates is useful.

We serve clients in Fort Lauderdale. Trust Counsel, PL’s only office is in Coral Gables.

Can a trust be decanted in Florida if the trust forbids it?

Talk Through Your Trust Question With Trust Counsel

If you’re asking whether a trust can be decanted in Florida, you may have received a notice you didn’t expect. A trustee’s proposal or a family disagreement over the trust’s terms can also raise the question. Those situations can feel urgent, and the deadlines are real. You don’t have to work through the statute alone.

Call (305) 707-7126 or schedule online to talk through your trust instrument and the notice in front of you. The first consultation is free, confidential, and carries no obligation to continue.