By Mike Beals

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The State of Michigan has overhauled the laws governing Trusts. As of April 1^st, the new code now revises the notice and accounting requirements for trustees and has even expanded trustees' powers and governs all Trusts, and is retroactive to those wills created prior to the first of the month.

The new default rules will apply unless the Trust is drafted specifically to modify the new provisions.  The new code also allows a trustee to reduce the likelihood of challenges to a trust with reduced timelines after the death of the creator and a specific statute governing 'no contest' clauses. Further, it has new rules for the Certificate of Trusts providing more ease in funding them.

Finally, the standard or requirements with regard to the capacity to make a Will or a Trust will now be identical. This means no further "being of sound mind" requirement when drafting a Will, in addition to many other new rules.

Remember, the use of Trusts as part of your estate and business succession plan better serves your four core interests: Orderly disposition of assets and business interests on death, privacy (no probate), avoidance or minimization of federal estate tax, and asset protection. Not only is it important to review trust documents in regards to the legal update, it is also important to periodically review changes in family and business circumstances which may dictate changes in your planning documents and how your trusts are funded during life. Feel free to contact Beals Hubbard, PLC, to schedule your review today.