Changing Your Living Trust

For the same reasons that you hired a qualified estate planning attorney to draft your initial estate plan, you should also hire a qualified estate planning attorney to revise or amend your living trust.

Trust Amendment or Amendment and Restatement

You can revoke or amend your revocable living trust at any time, so long as you are legally competent. If you wish to make a minor change to your trust, you can create an amendment to the trust, which is a simple document outlining the changes. The amendment should be kept with your original trust document.

If you need to make substantial changes to your trust, you will need to create something called an amendment and restatement. An amendment and restatement avoids your having to transfer all the property in the old trust into a new trust. Rather, the document serves to “restate” the terms of the original trust combined with any new provisions.

Never attempt to make changes to your revocable living trust by crossing out provisions you want to delete and writing in your changes. Your handwritten changes will either be ineffective or they may void the entire document. A trust amendment or amendment and restatement must be executed with the same formalities as the original document. You must sign it and your signature may need to be notarized. The best practice is to have your estate planning attorney prepare your amendment or amendment and restatement and to execute it with his or her supervision.

Moving Property in and out of your Revocable Living Trust

The need often arises to add property to a revocable living trust or to remove property from it. You do not need to amend your trust to do so. Your trust is written to allow you to transfer property you own to the trust and, as the trustee, to sell or transfer property in the trust just as if the title were still held in your name. So long as you have your own, individual living trust, you may transfer property in and out of your trust as often as you wish.

If you own a joint trust with another person, such as a spouse, you may need his or her written consent when moving the assets.

Do not neglect to transfer newly acquired property to your trust. One of the principal reasons people include a revocable living trust in their estate plans is to avoid probate. However, if you do not transfer your assets to the trust, probate will still be required. Moreover, if assets are left out of the trust, they cannot be distributed according to the provisions of the trust.

A trust document typically has attached to it a schedule listing the assets to be transferred to the trust. Many people mistakenly believe that the trust document and schedule actually transfer the property. That is not the case. The schedule merely indicates which assets you intend to transfer. To fund the trust, you must still take steps to change the title of the assets to the name of the trust. For real property, this involves changing the property deed. Stocks and bank accounts must be re-titled by the financial institutions where they are held.