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When does a trust dissolve?

On Behalf of | Jun 1, 2018 | Trusts

When discussing estate planning, it’s hard to talk for more than about five minutes without bringing up trusts. In modern estate planning practice, trusts are one of the most commonly used tools to help an individual protect his or her estate and determine how that estate gets distributed when the time comes.

But, for all this talk of trusts and the detailed work one must do to set them up and maintain them, it is not always clear how or when a trust ends. In very general terms, once a trustee distributes all the property within a trust, the trust dissolves. However, it is rarely as simple as handing out property to beneficiaries and closing the books.

The distribution of property may prove contentious, and beneficiaries or other parties who believe they have a claim to the property may push back or file claims agains the property to attempt to change the way that the trustee distributes the estate. The greater clarity a person can add to their wishes for their property, the greater protections that the trust can grant, and the more difficult it is for other parties to challenge these wishes.

If you have a trust or wish to establish one soon, you must take great care to make your wishes clear and leave as little ambiguity as possible. Furthermore, you should review the trust documents after any major life event or every there to four years, to make sure that changes in the law do not effect the terms of the trust. Assuming that your trustee can distribute your estate the way you intend without complications, your trust will then dissolve once the distribution is complete. Through careful planning and attention to detail, you can make your wishes known and protect your rights.

Source: FindLaw, “How Does a Trust End?,” accessed June 01, 2018


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