What happens when families restructure a trust specifically to manage a new compliance obligation — rather than for the commercial reasons trusts are usually restructured for.
Trusts are sometimes restructured — converted to a company, a fixed trust, or another entity — for ordinary commercial reasons: succession planning, bringing in new investors, or changing business needs. Compliance-driven restructuring is different: it happens because a legislative change makes the existing structure newly costly or risky to keep, and the family restructures largely to manage that new obligation.
The proposed minimum tax on discretionary trusts is a live example of a policy that could prompt exactly this kind of restructuring, at scale, within a defined window.