The settlor of a California revocable living trust may dissolve all or part of the trust at any time. A revocable living trust is an estate planning tool used to keep assets out of probate. A settlor creates the revocable living trust, transfers ownership of selected assets to it, and usually designates himself as trustee and primary beneficiary. He names alternate beneficiaries to receive assets upon his death. Until that event, he retains use and control of the assets, and retains the right to dissolve the trust at will.
Identify the appropriate dissolution procedure. If the document creating the trust mandates a specific dissolution procedure, it must be followed exclusively. If no procedure is specified, dissolution according to California law is appropriate if the settlor lived in California when the trust was created, the document creating the trust was signed in California, or the trust document specifies that California law applies.
Draft a dissolution document according to California Probate Code Section 15401 if no other dissolution procedure is specified. Identify the trust by naming the settlor or settlors and its date of creation. Declare the trust dissolved and provide the day and year of dissolution.
Sign the document as the trust's settlor. If there is more than one settlor, all must agree and sign. Otherwise, the signing settlor only dissolves the portion of the trust he created.
Send copies of the signed trust document to the trustee, if the settlor and trustee are different people. Send copies to all beneficiaries named in the trust and to all relevant financial institutions. For example, send copies to banks or mortgage companies holding notes on any trust property and to investment firms managing securities owned by the trust. Maintain a copy of the dissolution document for your records.
Remove, or retire, trust assets. Transfer ownership of each trust asset from the trust back to the settlor, or settlors, by executing a new ownership document for each asset. For example, remove the trust as owner of real property by executing a new deed naming the settlor as owner.