My grandfather recently died. My grandparent''s have a standard A/B living trust. Does my grandmother need a new trust?

"A/B" trusts can provide many different distribution provisions.  Perhaps most typically, the maximum amount of the deceased person's interest in the married couple's property that can pass free of estate tax will be allocated to a new, separate "sub-trust" called a "bypass," "exemption," or "credit" trust.  That trust is irrevocable - cannot be changed by the survivor (here your grandmother).  All assets in that irrevocable trust will escape estate taxation upon the survivor's death.  The survivor may have rights in that irrevocable trust to income and perhaps powers to invade it's principal for certain needs (e.g., health, education, support, and maintenance).  Most typically, everything else owned by the married couple will remain in a "surviving spouse's trust" which continues to be revocable by the surviving spouse.  The trustee will do an "allocation" of assets between the revocable portion and the irrevocable portion of the trust. I have said "most typically" because your grandparents' trust is not necessarily like that - the trust needs to be reviewed carefully.  Sometimes there is a third trust (a "qualified terminable interest property" or QTIP trust or marital trust), or there could be a "disclaimer trust." If your grandmother has no desire to change any of the provisions of the trust, she doesn't need to do a new trust.  She can (but is not required to) record a notice of your grandfather's death and the fact that she is now the sole trustee.  She does need to give a notice to the Assessor of the county in which the real property is located that your grandfather has passed.  Those forms can be obtained at the County Assessor's website. To make maximum use of her trust, she should transfer title to her other assets into that trust.  By doing so, probate may be avoided when she dies. One last point.  I'm not certain if your grandparents' estate is large enough for this to be an issue, or if your grandfather died in 2010, but if both of these things have positive answers (sufficient wealth and died in 2010) there is another issue - one that must be resolved by a week from today.

I am sorry for the loss of your grandfather. The exact language of the trust might require the assets to be divided or allow them to be divided. This is a big difference. I encourage you to find an experienced California estate planning attorney to review this with. The differences in language are subtle and even this very experienced attorney has to re-read some A/B trust clauses many times to determine exactly what it says. If the split is not required then the question becomes if one should bother splitting the assets. It does not take substantial paperwork but it will take some. Plus there will be added bookkeeping and potentially added tax preparation costs to having a split trust.  Thus many people with "disclaimer" A/B trusts, or non-mandatory, will not choose to split it. This is usually if the estate is smaller than the federal estate tax exemption limits.  On the other hand sometimes people with very modest estates want to split the assets into A and B because the B Trust will gain creditor protection in case the surviving spouse is in a spend down situation to qualify for Medi-Cal.  Thus, again working with an experienced attorney is important. Lastly, to answer your main question, it is not a new trust that is required. Rather, if the assets are divided into an A and a B trust there are some documents to prepare. These typically include: - Affidavit of death of trustee; - Certified Extract of Trust A; - Certified Extract of Trust B; - Acceptance by surviving trustee to serve as sole trustee; - Quitclaim deed of home to Trust A (typically); - Quitclaim of other real estate to Trust B (often); - Application for Federal Tax ID number for the B Trust (can be done on irs.gov). I would suggest a standard A/B trust split would probably incur between $1,000 and $2,000 in attorney fees. If it's a complex trust the costs can be more of course. Good luck to you.  -John