Helping With Your Changing Needs
Setting up your Trust and never looking at it again can sometimes be worse than not having a Trust at all. It is the wise and responsible thing to do to periodically review the terms of the Trust and ensure they remain current, relevant, and match your ever-changing family dynamic. If this periodic review does not take place, the beneficiaries end up with unrealistic expectations, and the Trust may be facing bitter and prolonged litigation that drains its assets.
The Law Offices of Maria N. Jonsson, PC can assist you with reviewing, amending, and restating your Trust. Reach out to our attorney to learn more about our comprehensive Estate Planning services, which include a review of your existing Estate Plan, and recommendations about updating it to both current laws, and to your current family circumstances.
When to Review and Amend Your Trust
A Trust should be looked over at least once every three to five years to ensure it is still relevant, and in line with both current law and your changing circumstances, including the size of your assets, the age of your children, and specific needs of your family. Change of circumstances — such as divorce, marriage, second marriage, the birth of a child, moving to another state, or the death of your named fiduciaries — mandates updating your Trust. A Trust is updated by way of a Trust Amendment or a complete Restatement of its terms. If you find that you need to update it, it is important to have an attorney to ensure that the Trust Amendment is property drafted and executed.
Many trusts spell out an "exclusive method" of how an Amendment is to be done, so that it is deemed valid. If this exclusive method is not followed, an Amendment can be rendered nil and void. As such, "self-made" Trust Amendments risk being deemed invalid.
First-to-Die & Second-to-Die Trust Administration
When one or both of the initial Trust creators (the Settlors) die, the Surviving Settlor or, if both settlors/spouses are gone - the named successor Trustee, takes over the management and control of the Trust property. This often includes collecting receivables, dealing with creditors, paying taxes, selling real property, liquidating investment accounts, and, ultimately, making distributions to the named Beneficiaries as provided in the terms of the Trust. This is not an intuitive process and involves important legal and tax considerations as well as strict deadlines. Penalties can inadvertently be triggered when deadlines are not abided by.
It is the Trustee's duty to ensure the rights of the Trust Beneficiaries are adequately protected. The Trustee is responsible for maintaining the Trust property income-producing and for providing information and Trust accounting to the Beneficiaries. We work closely with the Trustee and the Trust's CPA in regard to taking control of the Trust assets and marshaling those assets to the Trust Beneficiaries, rendering Trust accounting, filing personal and Trust income tax returns (or in some cases, Estate tax returns - to claim a portability election) through final distribution to the Beneficiaries and the Trustee's release from liability when the Trust is terminated. Portability election, federal Estate taxes, asset valuations, cost basis adjustment, sub-Trust funding, and preserving the property tax reassessment exclusion, are the issues that Trustees generally grapple with at this stage.
Call the Law Offices of Maria N. Jonsson, PC
If you think it is time to review and update your Trust, contact the Law Offices of Maria N Jonsson, PC. We offer guidance and solutions that are right for you and your family. Schedule a consultation today.
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Call our office at (424) 383-8445 for a consultation.