Updated January 25, 2024
With a New Hampshire living trust, the creator (termed as the “Grantor” or “Settlor”) transfers their assets into a trust in order to ensure that their estate is properly managed should they be incapacitated or when they die. All details of the assets included in the trust and how they will be divested must be described in the living trust document, which comes into effect once the Grantor has signed it. The Grantor will need to “fund” the trust by transferring all of the included assets into the trust’s name. The main advantage of creating a living trust, instead of relying upon a Last Will and Testament, is that the successors will bypass the lengthy probate process through which an estate is otherwise litigated in court. Before creating a living trust, you should find out which type best suits your needs and whether it is the most effective method to divest your estate.
Laws – Chapter 564-B (New Hampshire Trust Code)
Will (Last Will and Testament) – Contains any assets which are not included in the living trust. Often referred to as a “pour-over will.”
Individual Roles
The following roles must be appointed in the trust document:
Grantor (or “Settlor”) – Creates the living trust.
Trustee – The person given the authority to manage and distribute the trust.
Successor Trustee – Becomes the Trustee when the Trustee dies.
Beneficiaries – The recipient(s) of the trust estate when the Settlor dies or is incapacitated.
Types
Irrevocable – This type of trust cannot be revoked, altered, or amended once it has been signed. For extremely large estates, employing this type of trust will eliminate estate taxes on assets owned by the trust. It also protects the assets contained within it from the threat of creditors and bypasses probate.
Revocable – A Revocable Trust may be altered or revoked by the Trustee as they wish. This type of trust is used principally to avoid probate.
How to Make a Living Trust in New Hampshire
In accordance with § 564-B:4-402, for a trust to be created, the Settlor must have the capacity to create a trust and indicate an intention to create the trust. The trust will need to have a definite Beneficiary or Beneficiaries and indicate a Trustee and the duties that they are to perform. According to this law, the Settlor cannot make themselves the sole trustee or the sole current beneficiary. In the drafting of their living trust, the Settlor will list all of the assets which are to be included and how they will be distributed when they become incapacitated or die. Signing the form in front of a notary public is recommended, but not necessary. After creating the living trust, all of the assets that it includes must-have their ownership properly transferred into the trust’s name.
Motor Vehicles – To transfer ownership of a vehicle to a trust, a New Hampshire Bill of Sale can be used. The vehicle title can be transferred through the New Hampshire DMV.
Real Estate – To transfer real estate into a trust, a New Hampshire Deed transferring ownership must be signed in front of a Notary Public and filed with the County Registry of Deeds.
Financial Accounts – In most cases, the transferring of financial accounts can be accomplished by showing the living trust document to the account or branch manager and requesting that ownership be put in the trust’s name.
Do I Need a Living Trust?
If you have a large estate that you wish to protect and you wish to bypass the probate process when your estate is divested, it may be in your best interests to create a living trust. If your primary goal is to avoid probate, however, there is another available option. In New Hampshire, successors or heirs have the right to waive the full administration of probate (as per Section 553:32). To do this, the heir must petition the probate court to open a probate estate within six months to a year, providing that no outstanding debt exists. If this is accomplished, it will shorten the duration of time taken to divest the estate. To be eligible to petition the probate court, the successor should be a surviving spouse or only child and named as successor in the decedent’s Will. If the estate is to be divided amongst multiple beneficiaries, creating a living trust is a better way to bypass probate and ensure that the estate is properly divided without excessive litigation.