How to revoke a living revocable trust?

[wookumus]

What is the name of your state (only U.S. law)? OR, however the trust was prepared in NV
We have a living revocable trust prepared in NV in 2009. We have since moved to OR and are now going through a relatively amicable divorce with mediation assistance. We would like to revoke our trust but the lawyer who prepared it is no longer practicing. Of particular importance (please, don't laugh or harass), the trust has no assets whatsoever, nothing was ever transferred into it. So basically it's a pile of legal documents in a fancy binder. Do we have to go through a lawyer to do this? If so, does it have to be a NV lawyer? And if not, I have seen some basic revocation documents online, such as NOLO/rocketlawyer and others, is this adequate with a notary signature? Any other advice? Thanks!

 

[LdiJ]

What is the name of your state (only U.S. law)? OR, however the trust was prepared in NV
We have a living revocable trust prepared in NV in 2009. We have since moved to OR and are now going through a relatively amicable divorce with mediation assistance. We would like to revoke our trust but the lawyer who prepared it is no longer practicing. Of particular importance (please, don't laugh or harass), the trust has no assets whatsoever, nothing was ever transferred into it. So basically it's a pile of legal documents in a fancy binder. Do we have to go through a lawyer to do this? If so, does it have to be a NV lawyer? And if not, I have seen some basic revocation documents online, such as NOLO/rocketlawyer and others, is this adequate with a notary signature? Any other advice? Thanks!

If the trust was never funded, then its not particularly relevant and you can just destroy all copies of it so that your heirs will not attempt to fund it with your assets after your deaths. If your heirs were aware of the trust you might also let them know that its now defunct and that you will be doing other, separate estate planning. Its not like its registered somewhere. However, I would recommend that you get a quick consult with an attorney local to you now about that, just to make sure that there are not any other I's or T's to cross.

 

[HRZ]

I would agree..but this is the OP who wants to also do an amicable home transfer as a DIY project .

It may be safe to merely destroy the trust docuements ,and execute some mutual agreement to revoke it lest some signed copy come out of woodwork by some named benificiary under the old revoked docuement .

For things other than real estate , "funding " a trust may be as simple as a schedule of assets to go in it

Take time to make sure it is properly revoked by both of you ...and relatively soon ...

PS things like your wills and designated benificiary on things like pension plans also warrant timely updates , if /when applicable

 

[LdiJ]

I would agree..but this is the OP who wants to also do an amicable home transfer as a DIY project .

It may be safe to merely destroy the trust docuements ,and execute some mutual agreement to revoke it lest some signed copy come out of woodwork by some named benificiary under the old revoked docuement .

For things other than real estate , "funding " a trust may be as simple as a schedule of assets to go in it

Take time to make sure it is properly revoked by both of you ...and relatively soon ...

PS things like your wills and designated benificiary on things like pension plans also warrant timely updates , if /when applicable

Re the bolded, that is not accurate. The trust is not funded until the assets are in accounts with the trust's EIN. There can be instructions at to what is to be placed into the trust, but that does not "fund" the trust.

 

[HRZ]

LdiJ is correct ! MY error

 

[wookumus]

Helpful information, thanks as always for taking the time to respond!

 

[TrustUser]

a revocable living trust would not typically have its own ein

controlled by the social security numbers of the grantors

the federal govt doesnt even recognize a revocable living trust. it is all part of the federal estate - revocable living trust assets and assets in personal name

 

[LdiJ]

a revocable living trust would not typically have its own ein

controlled by the social security numbers of the grantors

the federal govt doesnt even recognize a revocable living trust. it is all part of the federal estate - revocable living trust assets and assets in personal name

Correct, it would not have its own EIN until the time when the trust is actually funded, which is usually when the person has passed away. Occasionally however, someone will choose to fund a revocable trust prior to the person's death, and will get an EIN and do so. That always causes some complications with tax returns.

 

[TrustUser]

not sure that you can have an ein and a revocable trust ?

what would it accomplish ?

you can not use a separate tax id for filing your federal return

and i highly doubt that any state allows that

otherwise, wealthy people would all have hundreds of tins, and little tax being paid by each

assets titled to a revocable trust can be gotten to by creditors, in the same fashion as if they are not titled to the trust

i dont think it complicates tax returns at all, since the tin is not used

can you present an instance which a tin other than the social security number is legally used correctly for a revocable trust ?

 

[LdiJ]

not sure that you can have an ein and a revocable trust ?

what would it accomplish ?

you can not use a separate tax id for filing your federal return

and i highly doubt that any state allows that

otherwise, wealthy people would all have hundreds of tins, and little tax being paid by each

assets titled to a revocable trust can be gotten to by creditors, in the same fashion as if they are not titled to the trust

i dont think it complicates tax returns at all, since the tin is not used

can you present an instance which a tin other than the social security number is legally used correctly for a revocable trust ?

Yes, it is possible to get an EIN for a revocable trust. There is nothing illegal about it. It can lie fallow and simply not be used until needed, or a trust can actually be funded.

I doesn't do anything useful it just complicates things to fund a revocable trust before it becomes irrevocable. (in my humble opinion) The income gets reported in the EIN of the trust and it always ends up being necessary to explain things to the IRS later when everything doesn't match up.

No, of course you are supposed to include the assets on your personal federal tax return when a trust is revocable.

I have no comment about the state...every state is a bit different.

Yes, I suppose someone wealthy might actually try to do that if they thought they could get away with it. I suspect that most of their accountants know that they cannot.

You are tying things together too closely. A trust having an EIN is perfectly legal and is a totally separate things from the taxes. Its no different than a child having an SSN yet not filing a tax return until they are a teenager and actually have some income.

 

[TrustUser]

i can understand the thought of applying for an ein, so you dont have to do it when the time comes

but it is illegal to use it

so there should never be any complications from it

when my dad passed, and i applied for an ein, i was asked what social security number it was for.

a long time ago i applied for an ein, for business purposes - so i could have one

never used it for a long time

and then when i gave it out as a number, it was no longer even in the system - i had to apply for a new one

unused numbers are not kept forever

it doesnt take a long time to get one, so really no reason to apply ahead of time

makes me wonder how long they wait to recycle social security numbers from people who have died ?

 

[TrustUser]

well that answers that muse - they havent run out of possible combinations, yet !!

 

[LdiJ]

i can understand the thought of applying for an ein, so you dont have to do it when the time comes

but it is illegal to use it

so there should never be any complications from it

when my dad passed, and i applied for an ein, i was asked what social security number it was for.

a long time ago i applied for an ein, for business purposes - so i could have one

never used it for a long time

and then when i gave it out as a number, it was no longer even in the system - i had to apply for a new one

unused numbers are not kept forever

it doesnt take a long time to get one, so really no reason to apply ahead of time

makes me wonder how long they wait to recycle social security numbers from people who have died ?

Re the bolded...

No, it is not illegal to use it because it is not illegal to fund a revocable trust. It unnecessarily complicates things but its not illegal. In fact, its a pain in the neck but its not illegal. Our firm has clients who have funded revocable trusts.

 

[TrustUser]

i dont know what you are referring to when you say "funding a revocable trust"

most of the time when i talk or listen, funding your revocable trust is the same as titling an asset with the trust name

so for example, i first create my trust. nothing has been titled to it, so it controls nothing, and is considered to be "unfunded"

once i change the title of any asset of mine to the name of the trust, the trust is then considered to be funded

and if i get all my assets titled over, then the trust is considered to be fully funded

you seem to be using the term differently ?

as i stated already, the federal govt does not even recognize a revocable trust. it is not a legal entity. so it is absolutely illegal to try to record a tax return, or anything else with an ein other than your social security number to the federal govt for yourself, as an individual.

obviously, a company that you own may have its own tax id number. but no revocable trust can have a tax return to the federal govt.

although i do not think that anyone would get away with it - simply because tax id numbers are directly associated with names. and i think it would automatically cause the irs to send you a letter to that effect.

 

[TrustUser]

What is “funding” my trust?
Funding your trust is the process of transferring your assets from you to your trust. To do this, you physically change the titles of your assets from your individual name (or joint names, if married) to the name of your trust. You will also change most beneficiary designations to your trust.

https://www.estateplanning.com/Understanding-Funding-Your-Living-Trust/

this is what i mean, and is commonly meant, when someone says "funding a trust"

a revocable trust has a tax id of the social security number of the grantor

once it becomes irrevocable, one applies for a tax id for the trust, itself.

there is no such thing as a revocable trust to the feds

and while states allow revocable trusts as an avenue to manage your assets upon your death, i would be highly surprised if you could even find one state that allows you to separate the trust assets from other personal assets on a state tax return, or anything that involves paying the state tax or any monies.