How Can I Modify or Terminate a Trust in St. Louis?
If one or more types of trusts are an integral part of your estate plan in St. Louis, it is important to know how to modify, alter or terminate them should you wish to make changes down the road. Your ability to do so – and the steps required to make the change – will depend on the type of trust you created.
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Modifying an Irrevocable Trust in St. Louis
The two primary types of trusts in Missouri are revocable and irrevocable. The key difference is that revocable trusts may be changed or modified at any time after they’ve been created, while irrevocable trusts generally cannot be altered by the creator alone. Though the permanency of an irrevocable trust can be daunting, it is still an attractive option for those who wish for greater asset protection.
By law in Missouri, the maker of an irrevocable trust generally cannot unilaterally make changes or terminate the trust, including adding or removing beneficiaries, replacing the trustee, or adding or removing assets. However, this does not mean an irrevocable trust is set in stone. Missouri law provides several paths to modify or terminate one under the right circumstances:
- All-party consent. If the trustmaker and every beneficiary of a non-charitable irrevocable trust agree to a proposed change, the trust can be modified or terminated without going to court at all.
- Trust decanting. In certain situations, a trustee may “pour” the assets from an existing irrevocable trust into a new trust with updated or different terms. Depending on the trustee’s discretionary authority under the original trust, this can sometimes be done without court approval.
- Unanticipated circumstances. Under the Revised Statutes of Missouri § 456.4-412, a court may modify or terminate an irrevocable trust because of “unanticipated circumstances or inability to administer trust effectively.” In these situations, the court will modify or terminate the trust to further the purposes of the trust in accordance with the trust-maker’s “probable intention.”
- Uneconomical trusts. Under Revised Statutes of Missouri § 456.4-414, a court or the trustee may modify or terminate a trust if the trust property is too low in value to justify the ongoing cost of administering it.
Because each of these paths comes with its own legal requirements, it is critical to take care when initially creating your irrevocable trust and to consult an attorney before attempting any of these modification methods.
¨With a background in business and real estate, I have a strong passion for guiding others through these complex areas of law. I became an attorney to have a positive impact on others. I strive to do everything I can to help my clients find a solution for their unique legal challenges.¨
Ted Disabato
How to Modify or Terminate a Revocable Trust in St. Louis
If you have a revocable living trust, on the other hand, you have the ability to change or terminate the trust at any time and for any reason as the maker, as long as you remain mentally competent to do so. There are two basic ways an alteration can be made to a revocable trust in Missouri:
- Trust amendment. You can put the modification you wish to make in writing in a document titled “trust amendment,” with your signature and the date. You can attach this amendment to your original trust documents for it to become part of the revocable trust. This way is most suitable for small or minor changes to a trust.
- Trust restatement. If you wish to make larger changes to a revocable trust, a restatement is the better option. With this process, the original trust documents must be recreated with the changes you wish to make. The entire document then becomes the “trust restatement.”
If you want to terminate or revoke a trust entirely, you must follow the instructions for doing so that are included in the trust, if provided. Typically, you must state your intent to revoke the trust in writing, then defund the trust and transfer the titles of any assets previously held in the trust.
When to Contact a Trust Attorney in St. Louis
Before attempting to make changes or terminate a trust in St. Louis, it is in your best interest to consult with an experienced trusts attorney in St. Louis. A lawyer will make sure you complete the desired task according to all applicable laws and the correct legal procedures in Missouri. This can prevent common mistakes that may otherwise jeopardize the integrity of your trust and put the future of your assets at risk. Contact one of our estate planning attorneys in St. Louis at TdD Attorneys at Law today.
Ted Disabato
Ted D. Disabato is the Managing Member of TdD Attorneys at Law LLC, Broker/Realtor of TdD Premier Real Estate and The Realty Shop, and partner in VUE Title LLC and VUE Mortgage LLC – providing his clients cradle to grave service. If you’re looking for an experienced St. Louis estate planning lawyer, make sure to contact Ted Disabato today.