How to Modify a Living Trust

By Elizabeth Stock

A living trust is a legal document that can benefit you and your beneficiaries during and after your lifetime by implementing a plan for managing your assets. However, situations may arise in which you find yourself needing to modify your living trust after it has been created. For example, you might sell some of the assets held in the trust or you might marry, divorce or have a change of heart about one or more of your beneficiaries. You can modify a living trust by drafting and executing an amendment to the trust. The laws of each state differ as to how this procedure is accomplished.

A living trust is a legal document that can benefit you and your beneficiaries during and after your lifetime by implementing a plan for managing your assets. However, situations may arise in which you find yourself needing to modify your living trust after it has been created. For example, you might sell some of the assets held in the trust or you might marry, divorce or have a change of heart about one or more of your beneficiaries. You can modify a living trust by drafting and executing an amendment to the trust. The laws of each state differ as to how this procedure is accomplished.

Step 1

Draft an amendment to your living trust. It must refer specifically to the original trust document and be clearly identified as an amendment. You can accomplish this by writing “Amendment to the Grantor’s Living Trust” across the top of the document. List any additions or deletions you wish to make to the living trust and identify each page and paragraph you are referencing in the original document. Create a space at the bottom of the document for the grantor’s signature and date.

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Step 2

Sign the living trust amendment before a notary public. All grantors of the original trust must sign the amendment. For example, if you and your spouse are the grantors of the living trust, you must both sign the amendment in the presence of a notary public for it to be valid.

Step 3

Attach the amendment to the original trust document, using a staple or paperclip. The amendment will not be valid and likely won't make sense unless it is read in tandem with the original trust document.

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Amending a Living Trust in California

References

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With a trust, you transfer assets to a legal entity set up to shelter your estate from the probate process. A trust allows you to control who will inherit your property after your death and give instructions to a trustee on how to manage that property. Although an irrevocable trust, in theory, cannot be changed or cancelled, there are ways to close down the trust and, if you wish, transfer assets to a new one. If the trust no longer serves the purpose for which it was set up, you may revoke it or draw up amendments that substantially change its terms. In most cases, this process will be subject to review by the courts to ensure that the beneficiaries retain the rights they were granted in the original trust.

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