Chapter 12.10 Gifts to Trusts

• Jurisdiction: Washington

§12.10 GIFTS TO TRUSTS

The Uniform Testamentary Additions to Trusts Act, RCW 11.12.250, provides that a gift may be made by will to a trust if (1) the trust is identified in the will and (2) its terms are evidenced in writing. The writing must be either (1) a separate trust instrument executed by the trustor prior to or concurrently with the testator's execution of the will or (2) created by the will of a person who predeceases the testator, regardless of when the will was executed. The statute does not refer to a testamentary trust (i.e., a trust created by the testator's will).

The statute expressly provides that the existence, size, or character of the corpus is immaterial to the validity of the trust, so the trust need not be funded at the time of the testator's death. The fact that the trust is amendable or revocable, or that it has been amended after the execution of the testator's will, does not affect the validity of the gift.

Unless the will provides otherwise, an express revocation of the trust prior to the testator's death invalidates the gift. In other words, if the trust has been expressly revoked, the gift to the trust fails and passes under the will's residuary clause or, if the gift was from the residuary and there are no other residuary takers, pursuant to the intestacy statute. However, if the trust has terminated for any other reason (e.g., its term has expired), the gift remains valid. Thus, if a gift is to "the trust established for the benefit of my children by my spouse's will" and the trust in question terminates when the youngest child reaches a certain age, which has occurred, the gift passes to the trust remaindermen.

Similar provisions in the insurance statutes validate life insurance beneficiary designations in favor of trusts. RCW 48.18.450 provides that life insurance proceeds may be payable to the trustee of a trust created by the insured during his or her...