What Can And Cannot Be Changed In A Trust?
What cannot be changed in a trust is typically who the creator of the trust is. That always stays the same. What can be changed in a trust is pretty much anything else. The beneficiaries can always be changed, and the trustees can always be changed, if the trust creator is alive. If the trust creator is deceased, other people can get the trustee removed. If you, as a creator, do not want to ever have your trust changed or modified, you need to address that upon the creation of that trust.
Why Might Someone Ever Wish To Terminate A Trust?
Someone who has created a trust in their lifetime may want to terminate the trust because it may be too complicated for them. They may be out of assets, so having a trust and dealing with that level of complexity may not make sense. Someone may have created a trust which no longer fulfills the person’s original purpose for creating it. Terminating a trust that you are a beneficiary of is much more difficult. The intent of the law is that the creator can still control the property and the creator’s intent should not be frustrated by any third party, including a judge.
Beneficiaries may not like being subject to a trust arrangement. They may want their inheritance outright. The purpose behind our existing trust laws is that the beneficiary can’t just modify a trust to get their hands on the money. Termination is very much looked at unfavorably and is limited in scope to when it no longer makes sense to keep the trust going because of economic reasons.
When Can Someone Terminate A Trust?
You can terminate a trust, if you’re the creator. Upon termination, the trust will transfer the assets back to your individual name. When someone has created a trust and now that person has died, and the family is settling the trust document, termination occurs after all the expenses are paid and assets are distributed.
If My Trust Is Modified Or terminated, Will It Result In Challenges To My Estate Plan?
As part of any kind of review by an attorney or judge initiated by someone seeking a modification or termination of a trust, there is an issue concerning people down the line who could otherwise be a beneficiary of the trust. If I’m asking for a modification from the court, it could change what I can do with the money and can also affect what people would take if I’m deceased, what they can do, and how much they’re left with. Consideration always needs to be given to the challenges of beneficiaries down the line. In some cases, courts will appoint a guardian ad litem or administrator ad litem to represent the interests of any minor beneficiaries down the line. The judge may decide not to grant the modification based on their concerns.
For more information on Changing The Terms Of A Trust In Florida, an initial consultation is your next best step. Get the information and legal answers you’re seeking by calling (904) 398-6100 today.
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