Can a Trust Be Amended?
Trusts are essential parts of estate planning. You can and should amend your trust if necessary. The transfer of your personal property held in a trust account occurs once you die so those contents don’t go to waste.
When most people create a trust, they select beneficiaries to receive their assets upon their death. Typically, a spouse, child, or another relative becomes the beneficiary of the account. However, there might be a time when you have to amend the trust if something significant happens, such as divorce or death.
Following a specific process to amend your trust is important, so you don’t face unnecessary issues. You can also ensure your property will go to the appropriate beneficiaries when you pass away. Your family could face various challenges to receive their assets if you make an error revising the documents.
How Does a Trust Work?
A trust is a legal method of distributing your assets to heirs or beneficiaries when you die. You can open a trust account and transfer specific assets while you’re still alive. You can also name specific people to receive your personal property once you pass away.
The person you name as the trustee of your estate can manage the accounts and ensure your assets go where they’re supposed to after your death. The trustee will authorize the transfer of your assets directly to your named beneficiaries. Having a trustee makes things easier for surviving family members so they know exactly who gets what and won’t have to go to court to fight over the assets each person should receive.
Amending a Trust
An amendment is much easier than revoking a trust and drafting a brand new one. If you already transferred assets into the trust account, you would have to retransfer everything if you decide to create a new trust.
You can amend your trust at any point before you die. It’s crucial to follow every step of the amendment process so the changes you make become legally binding. Any mistakes you make could interfere with the distribution of your assets when you die, allowing family members to challenge the validity of the document.
The amended trust you draft should include language indicating you’ve amended parts of the previous document. Notate any new terms you want to override the old ones and which provisions should remain in effect. It is beneficial to use the paragraph numbers in the original documents to avoid confusion about the sections referenced in the amended trust.
A legally binding trust requires a signature in front of a notary public. You should also include the original trust with the amended one, so it’s easier to review the changes.
Common Factors Resulting in Amended Trusts
Many people reach certain milestones in life or experience significant changes that require an amended trust. The most common factors include:
- New baby
- Removing or adding property to trust
- Picking a different trustee to manage the estate
- Getting a divorce
- Beneficiary’s death
- Adding or removing someone from trust
- Changes in any tax laws
- Moving to another state that has different legal requirements for trusts
- Change in financial standing, such as decreased income or higher value of assets
Contact an Experienced Estate Planning Attorney
At Mullen Holland & Cooper P.A., we understand the importance of caring for your loved ones even after you’re gone. You could avoid disputes within the family with a valid trust, so there’s no confusion about the distribution of your property.
For over 60 years, our legal team has assisted clients in North and South Carolina with estate planning. We can provide the guidance and advice you need to amend your trust, so your beneficiaries stay protected, receiving the assets you want to pass down upon your death.
If you need help amending your trust, contact Mullen Holland & Cooper P.A. today for an initial consultation.