Can One Revocable Trust to Be Transferred to Another?
A revocable living trust is a private agreement between three parties: the person who sets up the trust, known as the trust grantor; the person who manages the trust, known as the trustee; and the person who benefits from the trust, known as the beneficiary. A trust grantor can set up more than one trust. However, there are limits to how the trust can be used.
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Identification
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Think of a revocable trust as a box in which you can safeguard high-value assets. The contents of the box benefit your children, relatives and future generations after your death. While you cannot transfer another revocable trust into the "box," you can transfer real property, business interests, stocks, bonds, mutual funds, money market accounts, collectibles, works of art and rare automobiles.
Assignment Form
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By naming yourself trustor and trustee of the "box," you own and have access to the contents during your lifetime. If you wish to modify the contents of the "box," prepare an assignment and record the sale or transfer of any real property into or out of the box. An assignment allows you to transfer ownership of property from one entity to another.
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Revocation Form
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To revoke or modify a revocable living trust, complete a living trust revocation form. Identify the parties involved, itemize trust property and enter an effective date for the revocation. Have a notary public notarize the form and keep the original in a fireproof safe. Once the trust is revoked, transfer the trust's assets into a new or existing trust using an assignment form.
Considerations
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You may benefit from owning two separate revocable living trusts. Having two separate trusts may allow you to avoid the estate tax. At the time of publishing, a trust can distribute up to $5 million in assets before triggering the federal estate tax. The federal government recognizes every revocable living trust as a unique tax-paying entity.
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