Updating or Fixing Your Estate Plan

If you have already put together an estate plan there are many reasons why it may be time for you to reevaluate that plan and make some changes. You may be wondering why you would need to update your estate plan, which is a valid question. The answer is that the composition of family’s change, laws change, and one’s financial status or outlook on the transfer of wealth may change – all of which may give rise to problems that need to be fixed.

During one’s lifetime, most wills and trusts are amendable and revocable so that they can most often be updated by a codicil or amendment.

However, following the creator’s mental incapacity or death, making changes is more problematic and sometimes impossible.

There are generally four primary methods by which irrevocable estate planning documents may be fixed: construction, reformation, amendments, and decanting. It should be noted that problems with such documents do not usually arise until after the creator of the document has died, so you may want to pass along this information to your loved ones.

A construction proceeding is used to fix ambiguities that may arise from the way a document is written. The court will look at the language used in the document, trying to read it in a way that comports with the intent of the drafter.

A reformation proceeding fixes mistakes in the document, not ambiguities. Usually such mistakes are due to the drafting attorney misspelling someone’s name, but more serious errors also occur.

Amendment of a document is precisely what it seems: changing the document. While this is easy to do with revocable documents, it is much more difficult with irrevocable ones.

Much like the process of pouring wine from the bottle to allow it to breathe, “decanting” is pouring an irrevocable trust into another irrevocable trust that lacks the problems of the first.

To determine whether an existing plan can be modified and to make sure that the desired changes are accomplished and legally valid, it is important to work with an experienced and qualified estate planning attorney.

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Timothy P. Murphy

Timothy P. Murphy is an estate planning and elder law attorney whose practice emphasizes helping people to build, preserve and pass on their wealth. He works with his clients to accomplish their goals while avoiding unnecessary court proceedings and minimizing or eliminating exposure to death taxes.

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