Legal Question in Wills and Trusts in California

Without looking it up, which is beyond the scope of a free answer, I am not 100% sure, but I am 95% sure you cannot do that. Trusts can take many forms and some can have near perpetual life (subject to the rule against perpetuities). REITs are an example, but it is extremely unlikely that what sounds like an intervivos trust for estate planning purposes could be used that way. Furthermore, why would the remaining co-trustee want to place his property in a trust for the benefit of the other trustee/beneficiary. Once an intervivos trustor dies, you can't change the beneficiaries. Trustees usually can be changed one way or another, but not beneficiaries. The trustee with the property should just set up his own trust.

Without reviewing the documents I can say that most trusts call for assets to be distributed and the trust to be terminated at a certain point. It is the language of the trust that determines what is to occur. Sometimes there is an immediate termination, while others have assets remain in trust until a beneficiary reaches a certain age. Other trusts give the trustee discretion to hold assets in trust if the beneficiary has certain issues that would make distribution detrimental. A beneficiary ordinarily cannot modify the terms of the trust. I suggest that you consult with an attorney who can review the actual documents. I would be happy to assist you with this process.

I understand your thinking: A trust already exists; let's save some money and put it to a new use. But I agree with the other attorneys' answers.

Creating your own personalized trust does not have to be that expensive. Although I am licensed in both California and Nevada I limit my trust practice to Nevada residents. However, the legal market in California is just as competitive as it is Nevada. Here in Nevada I will sit down with an individual or couple and create a personalized trust for them along with all associated documents such as pour over will, a deed of their residence into the trust, health care powers of attorney, etc. for $675. www.probatenevada.net My trust doesn't avoid federal estate taxes, but currently there are no federal estate taxes for estates under $5,000,000 and in Nevada we have no Nevada estate taxes.

Having a trust written by a trust attorney taking into account your exact situation can be well worth the cost in terms of avoiding probate, avoiding fighting among the heirs, and potentially saving on taxes. If there are tax issues that will require a more expensive trust, usually the tax savings are much larger than the trust fee.

To pick out a good trust attorney check the attorney's avvo.com rating at avvo.com and go to the California bar website and check that the attorney has not been disciplined by the Calif. bar.