State Bar Recommendations for Decanting

“Decanting” is the process of transferring the assets located in one irrevocable trust to another. The Texas State Bar issued a response to IRS Notice 2011-101, and argued that decanting should be treated as a non-realization event. This treatment is similar to the way that the IRS treats other decanting events, such as those between revocable trusts. 

See Matthew Evan Rappaport, Taxation Section of Texas State Bar Issues Recommendations Re: “Decanting”, Wealth Strategies Journal, May 25, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.