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When Do Trusts Expire? How Often Should I Have My Trust Reviewed?

Sept. 4, 2020

The trusts I do expire either only when there is no property left in the trust or 20 years after the death of the last person mentioned in the trust.

Trusts end when there is no property to be administered by it, the person with the power to do so revokes the trust or it reaches that ridiculously long deadline. The last is because of a legal rule, which is too complicated to explain here and is not one that people need to worry about unless they are planning to be frozen when they die to be revived a long time later.

I have heard of attorneys who offer their clients, in addition to the trust and associated papers, a trust review and updating service, usually for an annual fee. In almost all cases, this is a waste of money.

Having your trust reviewed is often a good idea, but not because it might become stale but because it might be defective. Some trusts are badly written, do not say what the client wants them to say. They can be invalid for various reasons or have some provision that defeats the purpose. Those possibilities make a review of the trust worthwhile, but by someone else, not the person who made it in the first place. The main downside to having it reviewed is the attorney fee. I do not charge a fee to review a trust.

An attorney can set up a trust in a way that will require updates. One way is to specifically identify what is in the trust. Then, every time your property changes, you need to update the list. I never do that and I see no advantage to doing that, except to fatten my bank account.

I set up my clients’ trusts so that there would only be three circumstances whereby the trusts should be revisited.

You change your mind. If you decide to change something the trust provides, such as changing who gets what or who will be in charge, you must amend the trust.

You change your marital status. If get divorced or you get married after the trust has been made, the trust must be changed or reaffirmed. However, if you are widowed, you should tell me, but it is unlikely that you will need to change anything. The trust goes on, with you in sole charge of it.

You acquire new property that has a title on record. Regardless of what the trust says, the title on record controls. Any real property needs to be transferred into the trust. Any accounts need to reflect the trust either by being put in the trust’s name or having the trust specified as the payable on death beneficiary.