• what is a trust restatement

What is a Trust Restatement?

Are you considering making changes to your living trust? A People’s Choice can help you. It is not uncommon for people to want to make changes to their living trust. Life circumstances often result in people needing to revise gifts to or add beneficiaries to the trust. Some changes to your living trust can be made by a simple amendment to the trust. For other changes, it may be better to prepare a restatement of a trust. Read on to learn more about what is a trust restatement and how A People’s Choice can help you.

What is a Trust Restatement?

A Trust Restatement is a super amendment to your living trust. A typical trust amendment allows the Trustee to make minor changes to the trust provisions. Sometimes, however, it is better to prepare an entirely new trust document. When it is time to update your living trust, A Trust Restatement allows you to change anything and everything you want to change in your trust. The only thing that does not change when you restate your trust is the name of your trust. The name of your trust will stay the same, even though you may change everything else about the provisions and content in the trust. People who restate their trust typically want to change their successor trustees, beneficiaries or other substantive aspects of their living trust.

Why Restate Your Living Trust

A revocable living trust is a fully revocable trust. This means the trustor can revoke the trust at anytime during his/her lifetime. The restatement of a living trust in California creates an entirely new trust document but it is not a new trust. The restatement is an amendment to the trust and it also revokes all previous amendments. It is quite common for people who have a trust to make changes to it along the way. If a person or couple has already made several amendments to their trust, it becomes confusing about what provisions have been changed and what provisions have not been changed.  When a trust is restated, all previous changes can be incorporated into one new trust document. This eliminates a successor trustee being confused by multiple trust amendments and having to figure out what provisions were changed and what provisions were not changed. This is often problematic for the successor trustee after the death of the trustees. It becomes very confusing when there have been multiple amendments of a single Trust over an extended period.

A living trust should be restated in the event the trustor seeks to make significant changes to their living trust. A living trust should also be restated if the trustee(s) has/have  previously already made more than one or two changes by amendment. A person can also restate their living trust if their original trust documents have been lost, misplaced or destroyed. A trust restatement allows the trustee to easily and clearly update key provisions of their trust such as the nomination of successor trustees, selecting beneficiaries, identifying specific gifts for beneficiaries, or to change other terms of the trust. In addition, a trust restatement will update and restate a substantially out-of-date living trust to keep up with any changes to statutes or case-law since the trust was originally established.

Advantages of Restating Your Trust

There are several advantages of restating a living trust. For example, you will be able to keep your original living trust name. This is very important. Keeping the original trust name means you will not need to retitle the assets already titled to the trust. When a living trust is restated, the name and date of the original trust will continue to exist. If, rather than restating an existing trust, an entirely new trust was created, all assets would need to be re-titled and placed into the new trust u Dee the new trust name.

Trust Restatement vs Trust Amendment

There are two ways to alter provisions of a living trust. For simple changes, you can draft and execute an amendment to the trust document. Language explaining your new desires can be outlined in a separate document called a trust amendment. The document containing the revisions (amendment) will be attached to the original trust document. The trust amendment becomes part of the living trust document. As an alternative, if the trust document requires substantial revisions, it may be best to rewrite the entire document which is commonly known as restating the trust. The restated trust replaces the old trust and any earlier amendments.

A trust will need to  be amended in the event the trustor seeks to make minor changes to the living trust. This includes adding or deleting specific bequests, changing who will serve as the successor trustee, or updating the beneficiary’s name due to marriage or divorce. If the trustor wants to make multiple or extensive changes to his/her living trust, then a complete restatement should be considered. For example, if the trustor seeks to add a new spouse as the beneficiary and change distributions to family members, then a restatement to the living trust would better than a trust amendment.

What You Can Change When Restating a Living Trust

When you prepare a restatement of your trust, you can change every aspect of your trust that requires changing. You can change who you nominate as successor trustee, who the beneficiaries are, what the beneficiaries will receive, set up or revise minor subtrust provisions, and change any other provision your original trust may have had. You can update, add or delete property in your trust as well; and change, add or remove specific gifts of trust property.

Deeds, bank accounts, brokerage accounts, and other investments do not need to be changed if the title of such assets are already in the trust. If the restatement added new assets to the trust, the assets must be transferred into the trust name.

How to Prepare a Restatement of Trust

For more information about what is a trust restatement, Contact A People’s Choice. We can help you prepare a restatement of trust as well as update any other estate documents that may need revision. We can revise your current living trust to make sure it is in line with your desires/wishes. Your living trust may have provisions that are outdated or contrary to your desires. It may be in your best interest to start over by restating your trust.

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By |2018-01-18T15:47:07+00:00January 31st, 2016|Estate Planning|0 Comments

About the Author:

Sandra M. McCarthy, founder of A People’s Choice Inc., has worked exclusively in the legal field since 1976. She served as the 2004-2005 President of CALDA (California Association of Legal Document Assistants). She obtained a Paralegal Certificate from the University of California, Santa Barbara. During her career in the legal field, she has worked as a freelance paralegal, law office manager and paralegal studies teacher, and has co-authored numerous legal publications and written hundreds of self-help legal articles. As a registered Legal Document Assistant, Sandy is dedicated to providing affordable, low-cost, self-help document preparation services for California consumers in all 58 counties.

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