Regular estate plan reviews help address new estate planning developments.
Few things in life require no maintenance.
Those who purchase a home must eventually repaint, replace, or repair the roof, and even mow their lawns regularly.
When a person owns a vehicle, they must change the oil and eventually replace various parts to keep the car running.
Even the human body requires food, water, exercise, and doctor checkups for optimal health and well-being.
Why should estate plans be any different?
They require regular reviews to ensure they continue to account for changing circumstances, minimize tax consequences, provide appropriate flexibility and oversight to trustees or executors, and anticipate possible future disputes.
Santa Clara University held a symposium in late August highlighting why careful documentation and regular estate plan reviews are key to effective estate planning.
One estate planning development involves the growing prevalence of AI.
Although this technology can be a helpful instrument for estate planning attorneys as they review records, draft documents, or analyze collections of electronic communication, AI is not a replacement for the expert application of personal knowledge and skill in estate planning.
Estate planning attorneys and those seeking estate planning should not transfer the responsibility of plan creation to artificial intelligence.
When estate planning attorneys use artificial intelligence to assist their work, they remain responsible for the legal sufficiency, confidentiality, and accuracy of their services.
Attorneys must maintain appropriate documentation and oversight, follow court disclosure rules, and verify cited authorities as they use artificial intelligence.
Clients seeking an estate planning attorney should ensure the person or firm reviews any material generated by AI.
People should also not attempt to create their own estate plans using an artificial intelligence chatbot or software.
Although artificial intelligence may improve efficiency, reliance on it without verification can lead to lasting consequences from errors in trusts, last will and testaments, and court filings.
Yikes!
The connection between trust issues and gift taxes also arose during the August symposium.
Although many people believe making changes to a trust is uncomplicated if all loved ones agree on the update, they may be overlooking crucial tax issues.
A recent estate planning development in the Lewis v. Commissioner case underscores how surrendering valuable rights as a beneficiary could trigger gift taxes.
In this case, the children who were beneficiaries of a $117 million QTIP trust agreed to terminate the trust and provide the assets to their father.
Unfortunately for these children, the Tax Court determined each child made a taxable gift of more than $35 million when they gave up their remainder interest.
Yikes!
Even if an estate is not as sizable as the one in this case, beneficiaries should not assume consent to changes in a trust will result in no tax consequences.
Estate planning attorneys should review the value of rights being surrendered prior to proceeding with any trust changes for their clients.
The average American does not know what the term trust decanting means.
This term describes the process of moving assets out of an existing trust into a new trust under authority granted to the trustee by applicable law or the original instrument.
What purpose does trust decanting serve?
One benefit of trust decanting is that it allows a trust to be updated without beneficiaries having to directly surrender their rights.
This can help prevent the IRS from treating the transaction as a taxable gift by the beneficiary, on the reasoning that the beneficiary has a reasonable right to prevent or oppose the transaction.
The IRS's argument that a transaction is a gift from the beneficiary loses potency when a trustee has existing authority to independently modify the trust.
Trust decanting may not be universally appropriate for estate planning goals and does not erase all tax risks.
The best way to provide flexibility is through carefully drafted trustee powers, trust protector provisions, and powers of appointment.
Family conflict over trusts or last will and testaments often surfaces years after the plan has been created and the decision maker has died or become incapacitated.
Careful documentation is necessary as complicated family dynamics and longer life expectancies are more prevalent.
Estate planning attorneys should keep records of their clients' intentions, family histories, reasons for unequal distributions, and observations related to capacity.
These records, along with neuropsychological evaluations and medical records, can serve as key evidence if allegations of incapacity or undue influence arise in the future.
Families should also keep consistent records and communicate clearly.
If a parent or other loved one changes an inheritance arrangement, this person should record their reasoning at the time to underscore that it was a deliberate choice.
Another estate planning development is the increase in multi-state considerations.
It is more common for families to appoint trustees living in another state, buy property in another state, or move across borders.
When this happens, the laws governing the trust can become more complex.
How?
The location of the trust, the residence of the trustee, the domicile of the grantor, and the location of the assets can all influence the applicable state laws.
When the fundamental public policy of one state conflicts with the chosen law outlined in a governing-law clause, the legality of the trust and its terms may be in question.
When estate plans involve multiple states, trust planning should use trustee selection, thoughtful governing-law provisions, and administrative flexibility to address potential issues.
Those who change major assets or move states should review their trust documents to identify and preempt possible triggers for disputes.
The estate planning developments presented in the Santa Clara symposium demonstrate the importance of regularly reviewing estate planning documents.
Changes in technology, family relationships, state laws, and tax rules can all affect the functionality of an existing estate plan.
Working with an experienced estate planning attorney to evaluate and propose trust changes, identify outdated provisions, and document the reasoning behind choices can promote better estate planning outcomes.
Estate planning attorneys should not rely on AI for documentation.
Although artificial intelligence can be a beneficial tool, attorneys alone are responsible for protecting confidential information and creating effective estate planning documents.
When trust beneficiaries surrender valuable interests, the IRS may treat this action as a taxable gift.
To prevent complicated estate battles related to inheritance updates, keep records documenting capacity and the reasoning behind the decision.
People with estate plans involving trustees, beneficiaries, or property in different states must ensure their plans still function as intended under the laws of the governing jurisdiction.
Proactive planning and regular reviews with an experienced estate planning attorney can support goals amid estate planning developments.
This post is for informational purposes only and does not provide legal advice. You should consult an attorney for advice on any specific issue or problem. Nothing herein creates an attorney-client relationship between Harvest Law KC and the reader.
Reference: Wealth Management (September 30, 2026) "Five Key Developments for Estate Planners and Litigators"
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