Can you Terminate a Trust Fund?

If you are the heir of a trust fund, you may want to terminate the trust and remove the assets that are therein. As well, as the creator of the fund you may decide to change your mind and terminate a trust that you decide would be unecessary. There are two different types of trusts that property owners can set up for their friends and family in the future. One of these is a revocable trust. This is an account that can be terminated at any time by the request of the grantor or the person who is currently in charge of the trust. An irrevocable trust is a more permanent entity that is not supposed to be terminated at any time in the near future.

Still, the grantor and beneficiaries will be able to terminate any trust if they take the correct steps to do so. Maybe a grantor has realized that the trust fund she set up for her granddaughter isn’t going to be used wisely, and she would rather send the money to another relative or charity. Maybe on the other hand, a beneficiary to a trust fund would rather have the assets therein in bulk. Regardless of why you desire to terminate a trust fund, you will want to consider these important steps in order to achieve your goal.

To start, if a beneficiary wants to terminate a trust he or she needs to remove the assets that are within the account. The grantor will need to transfer all assets from the trust into accounting bearing only his or her last name. If the trust is irrevocable, then the grantor will want to contact the beneficiary and get permission to make this move. After you have completed this step, you will want to draft a Revocation of Living Trust. This is a simple legal document that lists the name of the grantor and has a statement that explains why you wish to revoke the trust. Include the date if that the form was filed with the statement and submit it to a local court. You will want to verify that you are in compliance with state law when you are filing this form.

In some cases, people may want to revoke a trust only to find that their reasons for doing so are not legal. You may want to get a probate lawyer involved if you are worried about running into conflicts with the law when you try to revoke the entity. Make sure that your attorney reviews your revocation request before your execute it to make sure that you are not infringing on the boundaries of your rights. If all is well, you will then want to execute your revocation. As a grantor, you will need to sign the document that executes the termination of the trust in the presence of a notary public.

If you are dealing with an irrevocable trust, the beneficiary that will be affected will also need to provide a notarized signature in order to merit a valid revocation. You will want to provide a copy of the revocation to all permanent parties so that they have proof of the action. After the Revocation of Trust is executed, you will want to keep a copy of the document on hand in case any complications rise. Whenever you are tampering with trusts and other probate issues, you will always want the help of a knowledgeable attorney. Without legal aid, you may make a grave mistake and end up in trouble with the law. Contact a probate attorney near you using this directory today if you need any assistance with estate planning, setting up or revoking trust funds, or another area of law regarding wills and probate.