RHODE ISLAND WILLS AND TRUSTS REQUIREMENTS
Statutory Authority.
Wills: R.I. Gen. Laws, Title 33, Chaps. 33-5, 33-6 (R.I. Gen Laws ยงยง33-5-1, et. seq.).
Trusts: R.I. Gen. Laws, Title 18: Fiduciaries (R.I. Gen Laws ยงยง18-1-1, et. seq.); Chaps. 18-2, 18-4, 18-9.1,ย
Rhode Island Will Requirements.
A testator who is โof sane mindโ and at least 18 years of age can execute a valid Rhode Island will. A Rhode Island will must be in writing and signed by the testatorโor for the testator by another person acting at the testatorโs express direction while in the testatorโs presence. Two or more witnesses must also sign a Rhode Island will. Both witnesses must sign while in the testatorโs presence after seeing the testator sign or acknowledge the will.
Though it is generally preferable for a willโs witnesses to have no interest in the testatorโs estate, a Rhode Island will is not invalid solely because a witness has an interest in the will. However, any devise or other beneficial interest in favor of a willโs witnessโor in favor of any person claiming an interest through a witnessโis โutterly null and void.โ A testatorโs creditors are not barred from acting as a witness to the testatorโs will.
A Rhode Island will must be proved valid before it can be admitted in probate. Proof of a will can be made through the witnessesโ testimony before the probate court or through notarized affidavits executed by the witnesses. A witnessโs affidavit can be executed at any time after execution of the willโincluding after the testatorโs deathโand must attest to the facts necessary to establish valid execution of the will. The Rhode Island Legislature publishes a suggested self-proving affidavit form within R.I. Gen. Laws ยง33-7-26(3).
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Amendment, Revision, and Revocation of Rhode Island Wills.
A testator can amend a Rhode Island will by executing a later will or codicil (a written addendum to an existing will) that supplements but does not revoke the existing will.ย A supplemental will or codicil must comply with all formalities required for execution of an original will.ย ย
A testator can revoke a Rhode Island will by executing a later will, codicil, or other document that expressly revokes the prior will and is executed in compliance with all requirements for an original will. A testator may also revoke a will by burning, tearing, or otherwise destroying the will with the intent of revoking itโor by directing another person to destroy the will while in the testatorโs presence.
A Rhode Island will is revoked by operation of law if the testator gets married after executing the willโunless the will appears to have been made in contemplation of the marriage. An exception is that a testatorโs exercise of a power of appointment within a will is not revoked if failure of the appointment would result in the relevant property not being transferred to the person who would receive the property if the property was in the testatorโs estate and the testator left no will.
A testatorโs divorce after executing a Rhode Island will automatically revokes any provisions in favor of the former spouseโunless the will appears to have been made in contemplation of the divorce. All other provisions of the will remain valid and take effect as if the former spouse had predeceased the testator.
A child born to or adopted by a testator after the testator executes a will is entitled to an interest in the estate as if the testator had died without a willโunless the omission appears to have been intentional and not the result of an accident or mistake.ย
Holographic and Oral Wills.
Rhode Island does not recognize handwritten (โholographic) or oral (โnuncupativeโ) wills except to the extent a holographic or nuncupative will made by a servicemember in actual military service or sailor at sea would be valid to dispose of the testatorโs personal assets under common law.
Rhode Island Trust Requirements.
Rhode Islandโs statutes governing trusts are codified within Title 18 of the Rhode Island General Laws. Rhode Island has not adopted the Uniform Trust Code approach used by the majority of states. Instead, the rules governing Rhode Island trusts are primarily derived from common law and Rhode Islandโs relatively unique statutes. Rhode Islandโs trust statutes include default rules but afford settlors significant latitude to override default rules through express provisions in a trust instrument.
A Rhode Island trustโlike trusts in other statesโmust have three parties: a settlor (or grantor), trustee, and beneficiary. The settlor creates the trust by transferring control of property to the trustee. The trustee holds legal title to the trust property and manages the property for the benefit of one or more named beneficiaries. A beneficiary is a person designated to enjoy the benefits of trust property without holding legal title.ย
Rhode Island law allows for overlap between a trustโs parties, so one person can beโfor exampleโboth settlor and beneficiary. However, a Rhode Island trustโs settlor cannot be the trustโs sole trustee and exclusive beneficiary. If that situation occurs, the trust โmergesโ and becomes invalid. Rhode Island law disfavors merger of trusts, and a future or contingent beneficial interest in another person is sufficient to prevent merger of a Rhode Island trust.
Although Rhode Island trusts can also be created by court order or implication, most Rhode Island trusts are evidenced by a signed, written trust instrument that defines the terms of the trust and names a trustee and beneficiaries. A trust instrument creating a Rhode Island trust can defineโamong many other thingsโthe terms under which the trustee distributes trust assets to beneficiaries. Distributions may be โdiscretionaryโโin which case the trustee has discretion to make distribution decisions in furtherance of the trustโs purposes. Or, distributions may be based on an objective formula or criteria set forth in the trust instrument.
A settlor โfundsโ a trust by formally transferring title to property to the trustee. A settlor transfers Rhode Island real estate to a trustโfor exampleโby recording a deed conveying the property to the trustee and noting the trusteeโs capacity as trustee. When a trust holds Rhode Island real estate, the settlor and/or trustee must execute an affidavit or memorandum of trustโwhich provide information about the trustโs parties and termsโand record the affidavit or memorandum in the land records of the county where the real estate is situated.
A trusteeโs authority to manage trust assets includes the power to invest, sell, exchange, and lease trust property and to exercise shareholder rights on behalf of the trust. Trustees are considered fiduciaries and must administer trust assets in good faith and avoid self-dealing. Trustees who invest trust assets are governed by the โprudent investor rule,โ under which a trustee must manage assets prudently in consideration of the purposes, terms, distribution requirements, and other circumstances of the trust. A trust instrument may expand, restrict, eliminate, or otherwise alter application of the prudent investor rule to a Rhode Island trustee.
Rhode Island trusts can be revocable or irrevocable. The settlor of a revocable trust retains the right to control trust property and to modify or terminate the trust. The settlor of an irrevocable trust surrenders the right to modify or revoke the trust. Irrevocable trusts give the settlor less control but sometimes offer tax or other estate-planning advantages revocable trusts do not provide.
A โliving trustโ (or inter vivos trust) is created while the settlor is alive, and a โtestamentary trustโ is created through the settlorโs willโonly becoming effective upon death. Revocable trusts are the most commonly used trusts in estate planning. A Rhode Island revocable living trust allows the settlor to retain control of trust property during life and declare how property will be distributed after the settlorโs deathโallowing assets to transfer outside probate. Rhode Island law also recognizes more specialized forms of trustsโsuch as charitable trusts, charitable remainder trusts, Medicaid trusts, custodial trusts, special needs trusts, and spendthrift trusts.
Rhode Island law authorizes domestic asset protection trusts (DAPTs)โa specific form of spendthrift trust that provides exceptionally strong protections against creditor claims. Assets held in a Rhode Island DAPT cannot be attached to satisfy most types of debtsโexcluding alimony, child-support, and personal-injury damages.ย
Rhode Island DAPTs can be โself-settled,โ which means the settlor can also be a beneficiary of the trust. A Rhode Island DAPT must be irrevocable, but the settlor can retain certain rights in the trustโincluding the right to receive distributions from the trust, veto distributions, and appoint a new trusteeโwithout invalidating the trust.
A DAPT must meet precise standards defined in the authorizing statute. A Rhode Island DAPT must haveโamong other thingsโa trustee resident in Rhode Island, a trust instrument expressly incorporating Rhode Island law, and a standard for distributions that does not give the settlor an unfettered right to trust principal.ย
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Estate Taxes: Rhode Island does not impose an inheritance tax but is among the minority of states that charge estate taxes to large estates. Rhode Islandโs exemption amountโthe minimum value before an estate qualifies for the taxโis $1,595,156 for deaths occurring in 2021 and $1,654,688 for deaths occurring in 2022. By comparison, the 2021 federal exemption amount is much higher at $11.7 million. Thus, many Rhode Island estates that do not qualify for federal estate tax must pay Rhode Islandโs estate tax.ย Rhode Islandโs estate-tax rate progresses from 0.8% to 16.0%โthough the stateโs tax laws include a credit system affecting actual taxes paid.
Small Estates Probate: Rhode Island law includes a streamlined probate process for qualifying small estates. A qualifying estate must include no real estate and personal property valued below $15,000โexclusive of tangible personal property. To apply for small-estates probate, a person with an interest in the estate files a sworn petition with the probate court requesting appointment as a voluntary administrator. Once appointed, the administrator pays final expenses and other estate debts and then disburses remaining assets to heirs. Small-estates probate allows for probate administration with less formality than ordinary probate.
Non-Probate Transfers:ย Along with living trusts, Rhode Island law offers several other options for transferring assets outside of probate. POD (payable-on-death) and TOD (transfer-on-death) designationsโwhich provide for automatic transfer of an asset to a named beneficiary upon an ownerโs deathโcan be used in Rhode Island for a variety of assets. For instance, POD designations can be added to financial accounts and CDs, and TOD designations can be used with assets like registered securities and brokerage accounts.ย ย
Similarly, some assetsโlike retirement accounts and life insuranceโallow owners to name a beneficiary who automatically takes ownership of the asset upon the original ownerโs death.
Assets co-owned as joint tenants with right of survivorship automatically transfer to a surviving owner upon the other ownerโs death, with no need for probate. Co-owners in Rhode Island can own both real estate and most personal property as joint tenants with right of survivorship. Rhode Island also recognizes tenancy by the entiretyโanother joint ownership form that includes a right of survivorship.ย Tenancy by the entirety can only be used in Rhode Island for real estate and is only available for co-ownership by married spouses.
Transfer-on-Death (TOD) Deeds and Vehicle Titles:ย Rhode Island does not currently allow TOD designations on either real estate deeds or motor vehicle titles. The Uniform Real Property Transfer on Death Actโa model statute authorizing TOD deedsโwas introduced in the Rhode Island Legislature in 2021 but has not yet been enacted.
Spousal Shares: To protect against spousal disinheritance, Rhode Island law provides surviving spouses a waivable elective share in a decedent spouseโs estate.ย The elective share is a life estate in all real estate owned by the deceased spouse, plus the surviving spouseโs share in personal property as if the deceased spouse left no will. The elective shareโwhich is in addition to any family allowances benefitting the surviving spouseโis in lieu of provisions in favor of the surviving spouse in the deceased spouseโs will. The elective share value can be distributed in actual property (โin-kindโ) or the value thereof.
If a decedent spouse is intestate (i.e., leaves no will), a surviving spouse receives a life estate in any real estate owned by the deceased spouseโplus a share in โsurplusโ personal property remaining after deducting specific bequests in the decedentโs will, creditor claims, final expenses, and administration costs. The surviving spouseโs personal-property share is one-half of the surplus if the deceased spouse died leaving children. If the deceased spouse died without children, the surviving spouseโs personal-property share is $50,000 plus one-half the remainder.
Creating a will or trust does not have to be difficult or intimidating.ย However, certain circumstancesโlike second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests (to name a few)โcan add a layer of complexity and result in unforeseen long-term consequences.ย Whenever any out-of-the-ordinary issues are present, itโs a good idea to consult with an experienced attorney familiar with and licensed under the laws of the relevant jurisdiction.
