Updating Your Trust
People often ask when they should have their Trusts reviewed or updated. Below is a good checklist for determining whether your trust needs a “check-up”.
Estate Plan is Not Current
If your Estate Plan was prepared prior to 2012, chances are good that it does not take into account the current tax laws. Most existing Trusts that I see provide for AB/By-Pass Trust which is no longer necessary for 99% of the people. It is very important that you amend a Trust with AB/By-Pass Trust provision prior to the incapacity of a spouse. If a spouse does not have capacity to amend the Trust, it is too late to remove AB/By-Pass trust provision.
Need to Change Trustees or Beneficiaries
If a designated Trustee has died or is no longer available to be your Trustee, you should consider amending the Trust to provide for a new Trustee. Also, you should review whether your current payouts to beneficiaries are still appropriate. Are their new grandchildren you wish to provide for in the trust? Is a current beneficiaries having emotional or drug problems which might make a supplemental or special needs trust more appropriate for their distribution?
Government Planning Provisions
Most pre-2012 Trusts do not have any provision for Government Benefit planning. If there is any possibility that you or your spouse will need government assistance such as skilled nursing, your Trust should include the power for your Trustee to deal with governmental agencies apply for benefits such as Social Security, Medicare, Medicaid and do Medi-Cal planning.