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I had named my now ex-spouse as beneficiary of my revocable trust. We then divorced. What effect does an Illinois divorce have upon my "revocable trust"?
Many people create what is known as a "revocable" trust. This is also sometimes called a "living trust" because the trust is created while the individual is alive. A person may put assets, money, or property into the trust and then name the trust as the owner of those assets. Upon death, those assets pass to a named beneficiary or beneficiaries. This is typically done to avoid having to file a probate case upon death.
The reason the trust is called a "revocable" trust is because the person creating the trust, or the "settlor," retains the power to revoke the trust and reclaim the assets anytime prior to death.
One of the Illinois divorce laws you should know, which answers this question, is called the "Trusts and Dissolutions of Marriage Act" (see 760 ILCS 35). An Illinois divorce does not automatically revoke your revocable trust. However, the trust assets that were to go to your now ex-spouse under your trust are automatically revoked upon your divorce. Your ex-spouse is treated as though he or she died before you (see 760 ILCS 35).Among the many Illinois divorce laws, it is important to familiarize yourself with the effects a divorce, legal separation, or annulment may have on your "revocable trust"and estate plan. Particularly, if you are a high net worth person or high income person, you must plan to change your revocable trust, and usually your estate plan, as soon as you know you are divorcing.
A knowledgeable and experienced DuPage County divorce lawyer at Martoccio & Martoccio can help. Please call 630-920-8855 to schedule your consultation. We look forward to helping assist you.