The general idea behind an irrevocable trust is that it cannot be changed or modified after it is created. However, even though this sounds like a fundamental rule, there are exceptions. It depends on how the trust was created and exactly what rules were laid out. In some cases, the trustee does have the right to change the terms.
Why would they do this? One potential reason is if tax laws change. This is often true for a charitable trust. The trust may be written to take advantage of the current tax laws, but those could change significantly in the years to come. The trust needs to be somewhat flexible so that it can be altered to work with these new laws, rather than trapping the trustee and the charity in the outdated provisions.
Another reason is if the beneficiaries of the trust may change. For instance, the trust may initially apply to an adult (the person’s direct heir), but the trust may pass on to that adult’s children later on in life. Multi-generational trusts need to best reflect the current times and the needs of these new beneficiaries, which may have been impossible to predict when the trust was made. In some cases, this means that the trust can be changed in a limited fashion so that it works as intended for the new beneficiaries.
In some senses, trusts are very straightforward and the rules that need to be followed are clear, but you can see how this is not always as obvious as many assume. It’s important for trustees to know what rights and options they have.