Question on trusts set up as result of a will

[JJFox]

My father passed away three years ago. His will directed the set up of several trusts, but with no details. I had thought that he set it up so that his wife, my stepmother, would live off of the income of the trusts and after her death, that the trust would roll down to me and my sister. I have never seen evidence of this, but was told my my stepmothers brother that it was set up that way. Is it possible that it was set up this way without my sister or I ever being notified? My stepmother never had any children, and sadly, has a terminal illness. She is very near the end of her life and not responsive. Just wondering if I should pursue this further, or if it truly is set up this way, would someone reach out to me?

 

[LdiJ]

My father passed away three years ago. His will directed the set up of several trusts, but with no details. I had thought that he set it up so that his wife, my stepmother, would live off of the income of the trusts and after her death, that the trust would roll down to me and my sister. I have never seen evidence of this, but was told my my stepmothers brother that it was set up that way. Is it possible that it was set up this way without my sister or I ever being notified? My stepmother never had any children, and sadly, has a terminal illness. She is very near the end of her life and not responsive. Just wondering if I should pursue this further, or if it truly is set up this way, would someone reach out to me?

Whomever is the trustee of the trusts would reach out to you if you become the beneficiary of the trusts. There is no requirement that you be told that you will eventually be the beneficiary of a trust just like there is no requirement that you be told that you will eventually inherit property/money under a will. Also, there was always the possibility that medical expenses or other high expenses for your stepmother could have used up the trust, so there was no guarantee that there would be money left for you and your sister to receive.

 

[adjusterjack]

Just wondering if I should pursue this further

If your stepmother's brother is still alive, ask to see the paperwork and an accounting of the trusts' assets.

There may be no legal obligation for him to show you anything but you won't know unless you ask.

 

[LdiJ]

If your stepmother's brother is still alive, ask to see the paperwork and an accounting of the trusts' assets.

There may be no legal obligation for him to show you anything but you won't know unless you ask.

While that is true, if my sister were dying and her stepchild asked me to cough up information about a trust fund at that moment, I would find it off putting to say the least. Particularly when there is no legal obligation to provide the information. It might be more tasteful to wait until after her funeral before making those kinds of inquiries.

 

[Taxing Matters]

My father passed away three years ago. His will directed the set up of several trusts, but with no details. I had thought that he set it up so that his wife, my stepmother, would live off of the income of the trusts and after her death, that the trust would roll down to me and my sister. I have never seen evidence of this, but was told my my stepmothers brother that it was set up that way. Is it possible that it was set up this way without my sister or I ever being notified? My stepmother never had any children, and sadly, has a terminal illness. She is very near the end of her life and not responsive. Just wondering if I should pursue this further, or if it truly is set up this way, would someone reach out to me?

A big part of all this are things you've not mentioned, and at least one of which you likely don't know:
1. In what state is this trust established? State laws on trusts and in particular the rules about who must be given copies of the trust instrument, trust accounting, etc and when they are entitled to them vary significantly depending on the state law that governs the trust. It may well be the state in which your mother-in-law currently resides, though it doesn't have to be.
2. Is the trust revocable by your mother in law or is the trust now irrevocable?

Bear in mind that as a step child you are not entitled to inherit from her estate unless she has a will that includes you and that you also have no right to anything in the trust unless the trust instrument provides for it. If the trust is still revocable and that power rests with the trustee of the trust you need to be sure that the trustee will have no reason to reform the trust to exclude you (assuming you are indeed a beneficiary).

In my state, once the trust becomes irrevocable it must be filed with the county but the only information that is public is the name of the trust and the trustee. Everything else is not public. However, the information that is public can assist possible trust beneficiaries to determine that there is at least a trust out there and perhaps they might be a beneficiary. My state's rule is not the more common rule used in this country however. In pretty much every state, however, once the trust is irrevocable and your definitely a beneificiary (i.e. already entitled to distributions) rather than a contingent beneficiary the trustee has to provide some kind of information to the beneficiaries, but again what information you get and when varies by state.

If your step mother currently is under the protection of a guardian or conservator that person may be able to provide you with more information about what he or she understands the arrangement to be. If that person is also the trustee, then he or she would have full knowledge of what the trust provides. The trustee doesn't have to share that information with you until the applicable state law requires it but the trustee might be willing to share some information anyway even if there is not yet any requirement to do so.

If your step mother were still fully mentally capable and not so close to death I would have suggested you ask her about it, assuming you have a good relationship with her. But since she is unresponsive there is little to be gained now by starting to ask people questions about it. I agree with the prior responses that making those kinds of inquiries now could rub the trustee or guardian the wrong way, leading them to assume that you only care about the money. Especially if the trust is still revocable that's not the impression you want to give whomever the current trustee or guardian is right now, if there are any. If you don't rock the boat while she's alive likely nothing will happen with the trust, if it exists, until after she dies. At that point the trust will almost certainly be irrevocable and then you won't risk things being changed to exclude you. If you don't hear anything about a trust after a suitable grieving period for your step-mother, that is the time I would likely choose to start making some inquiries about if if you've not received any information yet.

 

[JJFox]

Thank you all for your responses. I don’t know the state where the trust was created, and I agree that I should and will wait until after she passes before asking any questions.

 

[zddoodah]

Is it possible that it was set up this way without my sister or I ever being notified?

Yes.

Just wondering if I should pursue this further, or if it truly is set up this way, would someone reach out to me?

It all depends on exactly what the will says. You might not be notified about anything until your stepmother dies. Do you have a copy of the will?

I don’t know the state where the trust was created

In what state did your father live at the time of his death?