Updated January 25, 2024
The North Dakota living trust is a legal instrument used to bypass the probate process when distributing a person’s estate. The individual looking organize their assets in a separate entity (the Grantor) will need to draft a living trust document in which they list all of their assets, who the desired successors are, and detail how their estate is to be divided. Instructions are included for how the estate is to be managed should the Grantor fall ill, die, or otherwise be incapacitated. This can provide an assurance for the creator of the living trust, in that they have put in place a plan of action dictating how their finances and property be managed if they lose the ability to oversee this themselves. Once all of the Grantor’s assets have been legally transferred into the living trust, they are protected from probate and, with an Irrevocable Trust, creditors. If you are interested in creating a living trust, you will find information on living trusts, such as what the different types are and how to create one, further down the page.
Laws – Title 59 Trusts, Uses, and Powers
Registration – In 2007, Chapter 30.1-32 was repealed and there is no longer the requirement for a living trust to be registered in North Dakota.
Will (Last Will and Testament) – Any of the Grantor’s property that is not included in their living trust should be put into a Will, often referred to as a “pour-over will.”
Individual Roles
The roles involved in a living trust are as follows:
Grantor (or “Settlor”) – The Grantor is the creator and funder of the living trust.
Trustee – The Trustee is in charge of managing the trust.
Successor Trustee – The Successor Trustee becomes the Trustee in the event of the Trustee becoming incapacitated.
Beneficiaries – The Beneficiaries are the people named as successors of the trust estate.
Types
Irrevocable – An Irrevocable Living Trust avoids probate and has the advantage of protecting one’s assets from creditors. However, once it has been signed it cannot be revoked or changed.
Revocable – The Revocable Living Trust can be revoked or altered by the Trustee and avoids probate.
How to Make a Living Trust in North Dakota
Under Chapter 59-12, a trust may be created by anyone who is of sufficient mental capacity to indicate their wish to do so and understand the consequences of such action. The living trust must indicate one or more clear Beneficiaries, describe the Trustee’s duties, and it cannot put any one person as sole Beneficiary and sole Trustee. Creating the document only requires assigning the necessary Roles (Trustee and Beneficiaries), listing all of the assets included in the trust, and signing the document (preferably in the presence of a notary). After the document has been made, the living trust must be funded by signing over ownership of all the assets listed in the trust document.
Motor Vehicles – To put any vehicles into the trust’s name, a Bill of Sale is required, indicating the transfer of ownership. If the vehicle is less than nine (9) years old, an SFN 18609 Damage Disclosure Statement must also be completed and signed. These forms will need to be submitted to the North Dakota Department of Transportation. The title transfer fee is $5.
Real Estate – In order for real estate to be transferred into the ownership of the trust, a North Dakota Deed must be used to put the real estate in the trust’s (or Trustee’s) name. Once the deed has been signed and notarized, it will need to be given to the County Recorder’s Office.
Do I Need a Living Trust?
North Dakota uses the Uniform Probate Code which simplifies the probate process for people with smaller estates. Therefore, depending on your situation, it may be more expedient in the long run to opt for a standard Will instead of a living trust. Successors of estates valued at $50,000 and less can even avoid probate by notarizing and filing a Small Estate Affidavit with their circuit court.
If you are in possession of a complicated array of assets and accounts that you wish to have properly managed, a living trust will ensure that your affairs are carried out as per your instructions. A Revocable Living Trust will protect your estate from extensive litigation and legal fees, whereas investing in an Irrevocable Living Trust gives you the added security of protecting your assets from creditors or lawsuits that may prey on your estate.
When deciding whether a living trust is appropriate for your needs and your situation, you should always consult with a professional lawyer.