Trust Modification Options in 2026

1. To many, a trust seems like a permanent, irrevocable contract that’s not built for the surprises life throws. However, the reality is that advisors and their clients often face complex family situations, cross-border moves, evolving tax laws, and asset structures that necessitate revising trusts. For lawyers, financial planners, and trust and will advisers, knowing how and when a trust can change is an essential part of ensuring their clients’ last wishes are honored and their lawful heirs provided for.
   

   Why Clients & Advisors Revisit Trusts

   Here are some of the most common triggers that make clients ask, “Should my trust be updated?”

   • Changes in family structure: Marriages, divorces, births, blended families. What made sense 20 years ago may miss today’s reality.
   • New or changing tax rules: What was efficient then may be inefficient (or even risky) now.
   • Assets that weren’t anticipated: Maybe the trust holds business interests, unusual real estate, or investments that weren’t in view at the start.
   • Administrative and practical problems: Perhaps the original document lacks clarity, or trustee structure, successor trustee language, or situs provisions are outdated.

   These are the kinds of issues that decanting and nonjudicial settlement agreements are increasingly meant to address.

   Non-Judicial Settlement Agreements (NJSAs): What They Do (and Don’t)

   Think of an NJSA as a way for interested parties—trustees, beneficiaries, sometimes the settlor—to agree on changes without going to court. But it’s not a free pass. Key boundaries include:

   • The agreement can’t violate the trust’s material purpose. If the settlor expressly intended certain terms to be fixed, those often can’t be changed via an NJSA.
   • Beneficiaries whose interests are materially altered by the agreement may need to consent. It’s not enough that everyone “signs” if someone is materially harmed or left out.
   • States vary widely. Some have adopted the Uniform Trust Decanting Act (UTDA), while others use their own statutes. So, verifying state law is always step one.

   NJSAs resolve trust matters without a court filing, a process widely used to avoid time, cost, and public proceedings.

   Decanting a Trust: Pouring Old into New

   Decanting is another increasingly popular path. Essentially, it enables a trustee to transfer assets from an existing trust into a new trust with revised terms, provided that state law and the trust document permit it.

   Here are key points to watch:

   • Not all states allow decanting, or they permit only limited forms. Some have adopted the Uniform Trust Decanting Act (UTDA); others have their own rules.
   • Tax implications can be subtle. For example, moves that change beneficiary interests, alter trust durations, or transform grantor vs. non-grantor status may trigger tax consequences.
   • Notice and consent requirements vary. In some states, beneficiaries must be notified; in others, certain classes (remainders, unborn children, etc.) need specific protections.

   Guiding Clients Through Trust Modifications

   Here are conversation starters and check-ins you might use when guiding clients through whether trust modification is the right move:

   • Always begin with the trust document itself: Does it have decanting language? A trust protector? Clear successor trustee provisions?
   • Check state law first: Whether the state has adopted the UTDA or has particular NJSA statutes (or limitations) matters.
   • Talk through tax risks: Even modest changes can lead to unexpected tax liabilities.
   • Beneficiary clarity matters: Unlocated or unborn beneficiaries can complicate matters—both for NJSAs and decanting.
   • Document everything: Keep drafts, resolutions, and notice records. If things are challenged, thorough documentation is often what matters most.

   It’s tempting for clients to want “as much flexibility as possible,” but your role is to guide them toward an appropriate balance of flexibility and precision. Modifications should preserve the settlor’s core intent, protect beneficiaries, and minimize legal or tax risks.

   HeirSearch Can Help Establish Heirship for Trust Termination

2. If you’re facing a challenge identifying missing or unknown heirs of an estate or are terminating a trust, HeirSearch can help.

   HeirSearch’s professional researchers identify and locate missing or unknown beneficiaries and heirs for probate and trust termination. We work exclusively with executors, administrators, trustees, fiduciaries, bank and trust officers, and their counsel to establish kinship for legal purposes.

   Since 1967, we’ve successfully completed tens of thousands of worldwide searches. We proudly offer no-cost, no-obligation consultations, court-ready reports, and reasonable, non-percentage-based fees.

   Feel free to reach out with any questions — we look forward to connecting!

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