It’s important to review a revocable trust regularly to see if any amendments are needed, such as when something changes in your life. Some examples are: you have had or adopted a child; your spouse or other beneficiaries have died; you have remarried; the value of your assets, including life insurance death benefits in most cases, will exceed your available estate tax exemption amount (under Illinois or federal law); or the law changes.
If changes are needed, there are two ways to go about it. You can either amend the existing trust to change a certain part of it or rewrite the whole trust, which is known as a restatement.
While you might expect that an amendment is easier and more cost-effective, that’s not always the case. Remember that your trust should provide instructions to your heirs about your wishes, so it has to be clear and comprehensive.
If you’re making one or two simple changes, then amending is often sufficient. That’s especially true if the changes don’t interrelate. However, if you want many changes, it might be time for a restatement to ensure that the trust clearly states your wishes and is set up to be administered properly.
In addition, a restatement can also reduce how much paperwork you need to give to third parties like banks and avoid beneficiaries learning about prior terms of the trust. We are happy to discuss preparing and/or updating estate planning documents.