Quora Answer: Can I Use a Revocable Trust to Own an Irrevocable Trust?

The following is my answer to a Quora question: “Can I use a revocable trust to own an irrevocable trust, and thus control the irrevocable trust’s management?”

I am assuming here, that you are the beneficiary of the trust.  Otherwise, it makes no sense for you to think up such a convoluted ownership structure.

Regardless of the ownership structure, an irrevocable trust is still a distinct legal entity, and bound by the relevant financial and tax obligations.  The revocable trust is not a distinct legal entity from you.  As such, the revocable trust cannot be a trustee.  That trustee still has to be you.  If you wanted to control the trust, you have to arrange to make yourself the sole trustee.  That would require discharging the other trustees.  If you are not the settlor of the trust, but only the beneficiary, that may not be possible.  It may also require amending the trust document.

You must also consider that some places may have restrictions on you being both the sole trustee and the beneficiary, since that may contravene anti-money laundering laws.