A: Yes and no. First, let’s clarify the difference between a trust amendment and trust funding. An amendment is when you actually change the terms of the trust itself; this may be removing a particular successor trustee, or adding a new beneficiary, for example. Funding the trust, however, rarely requires an amendment to be made. Let’s assume these clients have 3 adult children, and the trust has simplified language leaving all trust assets to the 3 kids in equal shares. In this case, that will apply to whichever and however many properties and assets the trust owns at the time of the clients’ death, so there would be no need to amend the trust terms. HOWEVER, the rental property needs to be properly titled, vested and of record in the name of the trust. This is crucial given that even if the clients already have a trust validly in existence, their children could very well end up in probate one day if the clients forget to transfer title (or take title originally at close of escrow) into their trust.
Q: My husband and I completed our trust 10 years ago when we only owned our primary residence. In the next 6-12 months we are planning on making an offer on a rental property. Will we need to make any changes or updates to the trust once we complete that purchase?
