Time to Terminate? 5 Instances When a Trust Terminates in California
5 Instances When a Trust Terminates in California
Administering a trust requires careful attention to detail in order to protect trust assets and prevent the trustee from potential liability. If the trust itself does not clearly outline the procedure for its termination, knowing when to initiate this important step in the administration process may be unclear for many trustees. Fortunately, a knowledgeable trust administration lawyer can guide you through a successful trust termination.
When does a trust terminate in California? Below are five examples:
- The term of the trust has expired, as outlined in the trust instrument.
- The trust is already fulfilled.
- The purpose of the trust is unlawful.
- The trust’s purpose has become impossible to fulfill.
- The trust is revoked by the settlor or grantor.
There may be additional ways to terminate a California trust outside of those listed above. For example, a trustee or beneficiary can petition the probate court to make a determination as to whether the fair market value of the principal of the trust justifies termination.
Trustees must know when and how to terminate a trust in order to avoid scrutiny by beneficiaries or interested parties. Our article, “Trustee Mismanagement of Estate Explained by Riverside Trust Attorney,” offers additional information about what beneficiaries may do if they suspect wasting of trust assets. For further guidance, call the Grossman Law Firm at (888) 443-6590.