How To Receive Property Tax Relief in XYZ County / State When They Require One to Be Grantor & Beneficiary
Once any irrevocable trust has been established, one cannot go back and add a grantor - only trustees and beneficiaries; however, a beneficiary may be granted powers that effectively make them a 'grantor' for tax purposes, but only under certain conditions. This occurs under Internal Revenue Code (IRC) Section 678, which outlines conditions where someone other than the original grantor is treated as the owner of a trust for income tax purposes.
NOTE: Making this change per 12 USC ยง 678(a)(2) would result in the beneficiary-grantor owning any assigned assets in the trust under their personal name. In short, it would nullify all trust protections.
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