When and How Can a Trust be Modified?
Plans, assets, laws, and family dynamics all change over the years. Whether it has been one year or thirty years since you established your trust, you may have changed your mind on some of your decisions. Maybe your son ticked you off, and you want to give the Cadillac to somebody else. Or, the IRS Code may have changed, making your current planning sub-optimal for tax purposes. So, when and how can your trust be modified?
Revocable Living Trust
The majority of our clients have a Revocable Living Trust. If you are the sole trustmaker, you can amend, redo, or terminate your trust at any time, in any way, and for any reason so long as you are alive and mentally sound. If you and your spouse have a joint trust, both spouses will have to agree on any amendment. If one spouse has passed away, you should consult with your attorney, but the surviving spouse likely has the right to amend their “survivor’s trust” but is unable to amend the “bypass trust,” if there is one.
After the death of the trustmaker(s), a revocable trust becomes irrevocable and can only be modified if all of the beneficiaries are in agreement and get court approval.
Irrevocable Trust
Just like the name implies, an irrevocable trust generally cannot be amended. Trustmakers may retain very limited rights to change who the money goes to upon their death (called a power of appointment) but generally cannot change the trust once it is signed. The “trust protector,” usually an appointed attorney, can also make some narrow changes to the trust for tax purposes. Beyond that, an irrevocable trust is set in stone unless a court orders otherwise.
How to make amendments
If you have changes you want to make to your trust, or you don’t even remember what your trust really says, schedule a meeting to sit down with your Montana Estate Lawyers estate planning attorney. Once your attorney has explained your trust and you have decided on any amendments, an amendment can be made quickly and can often be as simple as a one- or two-page document.
