When Does a Living Trust End?

A living trust is essentially a perpetual legal contract among at least three parties. The trustor, the person who creates the living trust, can identify in the trust agreement the intended duration of the living trust. This allows the living trust to continue functioning even after the trustor passes away.

The living trust agreement can identify a definite time or event that will terminate the living trust. For example, the living trust may terminate, say, five years after the trustor dies. Or, the trust agreement might provide that the living trust ends as soon as the beneficiary reaches age 21, or as soon as the beneficiary graduates from college. The possibilities are endless because the trustor has considerable flexibility in defining the duration of the living trust.

Most living trusts are revocable living trusts, as opposed to irrevocable living trusts. A revocable living trust is a trust that the trustor can terminate, amend, end or revoke at any time. The trustor merely needs to inform the trustee that the trust is revoked, and then the trust ends. The trustee will transfer all trust property either back to the trustor or to the beneficiaries, all according to the instructions in the trust agreement.

Some living trusts are irrevocable, which means ending the trust is not a unilateral decision of the trustor. Instead, ending the trust requires the collective authorization of the trustee and the beneficiaries.

State court judges have authority to review, amend and terminate living trusts holding property located in their state of jurisdiction. Of course, this only happens if somebody requests the court to terminate the living trust. Judges do not look into or terminate living trusts of their own volition. But, if somebody wants to challenge the living trust then they can request a termination from a judge and the judge has authority to end the living trust at any time.