Early Termination of a Nevada Trust
Trust documents usually describe specific terms and circumstances for when trusts terminate. Nevada law specifies that interested parties (e.g., trustees or beneficiaries) may ask a Nevada probate court to terminate a trust if continuing the trust is no longer feasible or economical. This may occur when:
- The trust’s assets are worth less than $100,000. Depending on the type of trust and number of beneficiaries, it may make more sense to distribute the trust’s assets outright and free of trust and let the beneficiaries manage their own assets. It’s often a more efficient way to administer funds when the assets are limited.
- The value of the trust is insufficient to justify administration costs and trustee fees. There may be trustee fees and other expenses that cause the trust to become depleted. The expense of managing the trust can reduce the value of the trust more rapidly than necessary. When the assets of the trust are reduced to a level where the fees and costs are disproportionately large to the value of the trust, it may be appropriate to terminate the trust. When this happens, the trust assets are distributed to the beneficiaries outright and free of trust.
- The trustee is removed or replaced. A change in trustees presents an opportunity to revisit the terms of the trust. If a trust incurs a major change, such as a new trustee, the parties may find it more beneficial to terminate the trust altogether.
When determining how early termination of a trust will impact them, many people turn to a financial planner or their family’s general practice lawyer. But, Nevada trust law is complex and requires advice from an attorney that that is familiar with the intricacies of Nevada regulations governing trusts.
Other Reasons a Nevada Trust may Terminate Early
Parties involved in a trust may request early termination for other reasons including:
- Death of a beneficiary
- An individual wants to be removed from a group of beneficiaries
- All beneficiaries agree that the trust should be terminated
- Divorce or other relationship changes
- Intervention by a court
Regardless of the reason, all parties involved in the trust should be notified and seek advice from an experienced Las Vegas estate and trust attorney.
Our Las Vegas Attorneys can Advise You about Terminating a Trust
If you are a beneficiary, trustee or creditor you may seek early termination of a trust or be notified that a trust will end early. It’s very important to hire a Nevada trust and estate attorney to help you determine what impact early termination will have.The attorneys at LKP can help you. LKP provides our clients better service because we focus only on trusts and estates. Within this legal niche, LKP ranks among the top firms in Las Vegas.If you have a trust or estate issue, call us at (702) 333-1711 or contact us online.