Forgetting to include an asset or specific instruction within a trust document is a surprisingly common occurrence, even for those who meticulously plan their estates, and can lead to unintended consequences, potentially defeating the purpose of the trust itself; it’s not necessarily catastrophic, but it requires prompt attention and legal remedies to ensure your wishes are ultimately fulfilled – approximately 60% of Americans do not have a will or trust, so proactively addressing this issue is vital.
What happens to assets *not* included in my trust?
Assets not explicitly titled in the name of the trust remain outside its control and are subject to the probate process, which can be time-consuming, costly, and public; probate fees generally range from 3% to 7% of the estate’s gross value, diminishing the inheritance for your beneficiaries; furthermore, the probate court dictates how these assets are distributed, potentially diverging from your intended plan. This means that even with a well-crafted trust, any overlooked asset – a bank account, a piece of real estate, a valuable collection – will be subject to the standard rules of intestate succession or the terms of your will, if you have one. Consider the case of old Mr. Henderson; he meticulously funded his trust with his primary home and brokerage accounts, feeling quite secure, but entirely forgot about a small, but valuable, coin collection he’d amassed over decades. That collection, worth over $30,000, ended up in probate, costing his heirs both time and money.
Can I add assets to my trust *after* it’s created?
Yes, absolutely; most trusts include provisions allowing for amendments or additions of assets, however, there are crucial steps to follow; a trust amendment, a separate legal document, must be drafted and properly executed to formally add assets or change instructions. “Pour-over” wills are often used in conjunction with trusts; these wills essentially “pour” any assets unintentionally left out of the trust into the trust upon your death; however, assets transferred through a pour-over will still go through probate before being distributed by the trust, so the goal is to avoid reliance on this mechanism whenever possible. Ted Cook emphasizes the importance of regular trust reviews, recommending annual check-ups to ensure the trust remains aligned with your current assets and wishes. This is vital because asset ownership changes over time.
What if I discover an omission *after* my death?
Discovering an omission after someone’s death is more complex, but not insurmountable; the trustee, or a beneficiary, can petition the probate court to modify the trust’s terms or transfer the omitted asset into the trust; this often requires demonstrating clear evidence of the deceased’s intent and ensuring the modification doesn’t conflict with other provisions of the trust. This process can be costly and time-consuming, potentially leading to disputes among beneficiaries, and involves legal fees and court costs. It’s like the story of Mrs. Gable, whose daughter discovered a previously unknown brokerage account after her mother’s passing; it required a lengthy court battle to transfer those funds into the trust, delaying the distribution of assets to the beneficiaries by almost a year.
How can I prevent forgetting assets in the first place?
Prevention is always the best approach; Ted Cook suggests a comprehensive “asset inventory” as the first step in creating or updating a trust; this involves listing *every* asset you own – real estate, bank accounts, investments, personal property, digital assets – and noting how it is currently titled. Regular reviews, at least annually, are essential to update the inventory and ensure the trust remains current; a good estate planning attorney will guide you through this process, ensuring no asset is overlooked. I once assisted a client, a retired sea captain named Captain Davies, who had a treasure trove of nautical antiques; he was meticulous about his estate planning, but neglected to document these collectibles, so we added a detailed schedule of personal property to his trust, complete with photographs and appraisals, and that eliminated the risk of those items being subject to probate. This level of detail demonstrates a commitment to complete transparency and fulfills your intentions effectively.
Who Is Ted Cook at Point Loma Estate Planning Law, APC.:
Point Loma Estate Planning Law, APC.2305 Historic Decatur Rd Suite 100, San Diego CA. 92106
(619) 550-7437
Map To Point Loma Estate Planning Law, APC, a trust attorney: https://maps.app.goo.gl/JiHkjNg9VFGA44tf9
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