Will I Have to Amend My Trust Every Time I Acquire a New Asset?

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I Have a New Asset, Do I Need to Amend my Trust?

You do not have to amend your trust every time that you acquire a new asset. The trust instructions control the eventual disposition of the assets, but those instructions don’t change each time an asset is included. Instead, acquiring new assets is part of the ongoing funding process. You will want to take title to the asset in your trust’s name.

If you acquire valuable items of property after you create your living trust, promptly add them to the trust. You might also want to remove some items.

Steps to take with a New Asset

There are four steps to take:

Step 1: Revise your property schedule – Schedule A– adding new items or deleting old ones. You can revise your property schedule by recreating it using a word processing program. Double-check to make sure it lists every single item of property that you want in your trust.

Step 2: Sign the revised property schedule it and replace the old one on your signed original trust document.

Step 3: If you added property, transfer ownership of the property to yourself as trustee. You’ll need to change the property’s title document or, if the item doesn’t have a title document, use the Assignment of Property form, showing that you are holding the item in trust. If you removed an item, transfer it out of the trust. Either by changing its title document (i.e. deed) or using an Assignment of Property that transfers it from you as trustee to you as individual.

Step 4: If you need to name a beneficiary for property you’ve added, create an amended trust document. You won’t need to amend your trust document if you left all your trust property to one person. This also applies if you want the new property to go to the residuary beneficiary.

EXAMPLE: Rose and her husband Michael created a trust several years ago. Now they’re buying a house and take title as “Rose Morris and Michael Morris, Trustees of the Rose Morris and Michael Morris Revocable Living Trust.” They then prepare a revised Schedule A (which lists co-owned property) of their trust document, print it out, sign it and replace the old Schedule A.

Because their trust document leaves all their property to each other, they do not need to amend their trust document.

What About Really Big Changes? Do I Amend My trust then?

What if a Change Occurs That is So Big That I Need to Create a New Trust? Will I Have to Fund My Assets into My Trust All Over Again? No. Your attorney can “restate” your trust. A restatement acknowledges the creation of your trust on the date you originally created it, and states that you wish to restate that trust in its entirety. The restated contents of the trust will take the place of the contents of your old trust, but the trust name doesn’t change. It’s still the “John Doe Living Trust, created June 1, 2015” or whatever it was originally called. Think of it as the same book cover, but with changes in the text within.