Montana Wills vs. Trusts
Montana offers distinct estate planning advantages for its residents. The Treasure State recognizes holographic wills, provides informal probate procedures for qualifying estates, and recently authorized transfer-on-death designations for both real estate and vehicle titles. With no state estate or inheritance taxes, a generous $300,000 spousal inheritance threshold, and robust protections for trust beneficiaries through spendthrift provisions, Montana residents have powerful tools available to preserve their legacy while protecting heirs from unnecessary expenses and delays.
Table of Contents
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Montana Will Requirements
A Montana Last Will and Testament should include:
- Age and Capacity: Testator must be “of sound mind” and at least 18 years old
- Format: Must be in writing
- Signature: Must be signed by the testator or signed in the testator’s name by another person at the testator’s direction while in the testator’s presence
- Witnesses: Must be signed by at least two witnesses
Witness Requirements
For Montana wills:
- Witnesses must observe the testator signing the will or hear the testator acknowledge that the testator’s signature or the will itself is genuine
- Witnesses must sign within a reasonable time after witnessing the testator’s signature or acknowledgement
- The only qualification necessary to witness a Montana will is that the individual must be generally competent to act as a witness
An interested witness (someone who stands to benefit from the will) does not invalidate a Montana will or any provisions within the will.
Document Incorporation
Montana law authorizes a will to incorporate by reference other documents in existence when the will is executed. A testator’s intent to incorporate another document must be clearly manifested in the will, and the will must describe the document sufficiently to allow identification.
Montana law specifically authorizes incorporation by reference of a written statement or list disposing of the testator’s tangible personal property other than money. Sometimes called a “memorandum of personal property,” the list must be signed by the testator and must identify with reasonable certainty each devised item and intended recipient. The testator can create a personal-property list before or after executing the will and can alter the list after its initial preparation.
Self-Proved Wills
Though Montana does not require notarization of wills, a Montana will can be made “self-proved” through execution of notarized affidavits by the testator and the will’s witnesses. The affidavits—which may be executed simultaneously with the will or later—confirm that:
- The testator signed the will voluntarily
- The testator had the necessary legal capacity when signing
- The testator was under no constraint or undue influence
When available, a self-proved affidavit serves in place of witness testimony before a probate court. The Montana legislature publishes form language for self-proved affidavits at Mt. Code §72-2-524.
Substantial Compliance
Under Montana law, a written document that does not technically satisfy all formalities for a written will may be treated as a will and admitted to probate if a proponent of the document can establish through clear and convincing evidence that the decedent intended the document to constitute the decedent’s will.
No-Contest Clauses
No-contest (or “in terrorem“) clauses—which penalize a party for contesting a will or initiating estate-related litigation—are unenforceable under Montana law if the contesting person has probable cause for contesting the will.
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Amendment, Revision, and Revocation of Montana Wills
Amending a Montana Will
A testator can amend a Montana will by:
- Executing a codicil (a separate document that amends an existing will)
- Executing another will
In either case, the document must satisfy all legal requirements for execution of the original will.
Revoking a Montana Will
A testator can revoke a Montana will by:
- Executing a new will that revokes the prior will expressly or by inconsistency
- Performing a “revocatory act” with the intent and purpose of revoking the will (burning, tearing, canceling, obliterating, or destroying the document)
Montana law presumes that a later will that does not expressly revoke a prior will revokes the prior will by inconsistency if the later will completely disposes of the testator’s estate. A later will that does not completely dispose of the testator’s estate is presumed to have been intended as a supplement to the earlier will.
When a later will is treated as a supplement, both wills are fully operative except to the extent of any inconsistent provisions. If inconsistent provisions are present, the later-executed will takes precedence as to those provisions.
Automatic Revocation by Divorce
A former spouse divorced from a decedent does not qualify as a “surviving spouse” for purposes of Montana’s probate and non-probate transfer rules. If a testator divorces after executing a Montana will or revocable trust, revocable provisions in the will or trust in favor of the former spouse (or a relative of the former spouse) are deemed revoked.
Automatic revocation upon divorce does not apply if the will or trust instrument, a property settlement agreement, or a court order expressly provides otherwise. A will or revocable trust provision revoked by divorce is treated as though it was disclaimed by the former spouse and can be revived by remarriage.
Effect of Marriage After Will Execution
If a Montana testator marries after execution of a will, the surviving spouse inherits the same share of the estate he or she would have inherited had the testator died intestate—adjusted for any distributions to children of the testator born before the marriage and who are not children of the surviving spouse.
An omitted later-wed spouse’s presumed share is inapplicable if:
- The will was made in contemplation of the marriage
- The testator intended the will to apply notwithstanding a subsequent marriage
- The testator made other provisions for the surviving spouse outside the will intended in lieu of the will
Children Born After Will Execution
If a child is born to or adopted by a Montana testator after execution of a will—and if the testator did not otherwise provide for or appear to intentionally omit the child—the after-born child may inherit a share of the estate.
- If the testator had no other living children when executing the will, the after-born child’s share is equal to what the after-born child would have inherited had the testator died with no will
- If the testator had other children who the testator provided for in the will, the after-born child’s share is calculated based on the devises to other children
An omitted after-born child’s share is inapplicable if the will leaves substantially all of the estate to the child’s other parent.
Holographic and Oral Wills
Holographic Wills
A document that does not fully satisfy the requirements for an attested Montana will may be nonetheless valid as a holographic will if it is signed by the testator and all material provisions of the document are in the testator’s handwriting. Evidence outside of the document itself can be used to establish in probate that a testator created a document with the intent to make a will.
Oral (Nuncupative) Wills
Oral (or “nuncupative”) wills are not recognized under Montana law.
Montana Trust Requirements
General Requirements
Montana trusts are primarily governed by the Montana Uniform Trust Code. A Montana trust can be formed for most any purpose; provided, however, the purpose of a Montana trust must be:
- Lawful
- Capable of being achieved
- Not in conflict with the state’s public policy
Capacity Requirements
To create a valid trust under Montana law, the settlor must:
- Have adequate capacity (measured under the same standard applying to wills)
- Express an intent to create a trust
A Montana trust is void to the extent its creation was induced through fraud, duress, or undue influence.
Trustee and Beneficiary Requirements
A Montana trust must have:
- A trustee with actual duties to perform
- A definite beneficiary (subject to exceptions such as for charitable trusts, trusts for the care of animals, and certain trusts created for noncharitable purposes)
The sole trustee of a Montana trust cannot also be the trust’s sole beneficiary.
Trustee Duties
The trustee of a Montana trust has a duty to administer the trust:
- Expeditiously
- In good faith
- In accordance with the trust’s terms and purposes and beneficiaries’ interests
Trustees who manage assets are governed by the “prudent investor rule” and must invest trust assets prudently considering the trust’s purposes, terms, distribution requirements, and other circumstances. The prudent investor rule may be expanded or restricted by express provisions within a trust instrument.
Trust Creation Methods
Montana trusts can be created through:
- Transfer of property by a settlor to a trustee (either during life or through a will or other testamentary instrument)
- A declaration by the owner of property that it is owned as trustee
- Exercising a power of appointment in favor of a trustee
Other than a trust created by operation of law, a Montana trust must be evidenced by a written instrument establishing the trust signed by either the settlor or the trustee (or an agent of either with written authorization to sign).
Personal Property Lists
Montana law authorizes a revocable trust’s settlor to refer within the trust instrument to a written statement or list disposing of the settlor’s tangible personal property other than money. The list must be signed by the settlor and must identify with reasonable certainty each item and beneficiary. A settlor can create a personal-property list before or after executing the trust and can alter the list after its initial preparation.
Trust Revocation
A Montana trust is revocable unless the trust is expressly made irrevocable. The settlor of a revocable trust retains the power to revoke or amend the trust after its creation.
A settlor can revoke or amend a revocable trust using the method defined in the trust instrument or—if the trust instrument provides no method—by delivering to the trustee a written document manifesting the settlor’s clear intent to revoke or modify the trust.
Trust Reformation and Modification
A Montana court may reform a trust instrument to conform to a settlor’s intentions if the settlor’s intentions can be established and there is evidence that the terms of the trust were affected by a mistake of law or fact. A Montana court may also modify a trust to achieve the settlor’s tax objectives, and such modifications can be made to have retroactive effect.
Trust Termination
Montana trusts terminate upon:
- Revocation or expiration under the trust’s own terms
- When there is no purpose of the trust remaining to be achieved
- When the trust’s purposes become unlawful, contrary to public policy, or impossible to achieve
A trust may also be modified or terminated by a court upon the petition of the settlor, trustee, and/or beneficiaries. Or, in some circumstances, modification or termination of a trust may be made upon the consent of the settlor and all beneficiaries.
Creditor Claims and Spendthrift Provisions
The general rule in Montana is that creditors of a trust’s beneficiaries can ask a court to attach a beneficiary’s interest in distributions from the trust. However, Montana law protects beneficiary interests from attachment if a trust includes a “spendthrift provision” restricting beneficiaries’ right to transfer interests in the trust. When a spendthrift provision is present, most creditors of beneficiaries cannot attach trust assets until actually distributed to the relevant beneficiary.
Creditors of a Montana revocable trust’s settlor can attach trust assets as long as the settlor remains living (or, upon death, through estate claims). In the case of irrevocable trusts, settlors’ creditors can reach the maximum amount of trust assets that could be distributed to the settlor or for the settlor’s benefit.
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Special Considerations
Estate Taxes
No State Estate or Inheritance Tax
Montana does not impose either estate or inheritance taxes. Large Montana estates may still be liable for federal estate taxes.
Informal Probate
Simplified Administrative Process
Montana has an informal probate process that simplifies administration of eligible estates. An interested person petitions for informal probate by submitting a verified application to the probate clerk. The application identifies the applicant’s interest in the estate and provides information about the decedent and estate circumstances.
If the clerk determines that informal probate is appropriate, a personal representative is appointed for the estate. The personal representative issues necessary notices to creditors and beneficiaries, inventories estate assets, and makes appropriate distributions. Informal probate allows for an abbreviated, less burdensome probate process.
Non-Probate Transfers
Transfer-on-Death (TOD) Deeds and Vehicle Titles
TOD Real Estate Deeds
Montana law authorizes TOD designations on real estate deeds. When an owner of Montana real estate records a transfer-on-death deed (sometimes called “TOD deed” or “beneficiary deed”), the named beneficiary takes title to the property upon the owner’s death with no need for probate.
A TOD deed does not affect the property owner’s rights in the property during life, and the beneficiary does not acquire present rights in the property until death actually occurs.
TOD Vehicle Titles
The Montana Legislature authorized TOD designations for vehicle titles effective October 21, 2021. The new statute, Mt. Code §61-3-226, allows a vehicle owner to arrange for non-probate transfer of a vehicle’s title upon the owner’s death by submitting to the Motor Vehicle Division an application requesting a beneficiary designation on the vehicle’s title.
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Wills vs. Trusts: Comparison
| Feature | Wills | Trusts |
|---|---|---|
| When It Takes Effect | After death | Can be immediate (living trust) or after death (testamentary trust) |
| Probate Process | Requires probate | Assets in trust avoid probate |
| Privacy | Public record | Generally private |
| Challenges | Can be challenged in probate court | More difficult to challenge |
| Cost to Create | Generally less expensive | Usually more expensive |
| Ongoing Administration | None until death | May require ongoing management |
| Protection During Incapacity | None (requires separate power of attorney) | Can provide management if grantor becomes incapacitated |
| Montana Special Feature | Holographic wills; substantial compliance doctrine; personal property memorandum | Spendthrift provisions; default revocability; TOD deeds and vehicle titles |
Conclusion
Making a will or trust does not have to be difficult or intimidating for Montana residents. However, certain circumstances—like second marriages, stepchildren, aging parents, special needs beneficiaries, guardianships, and business interests—can add complexity and result in unforeseen consequences.
Montana offers unique estate planning tools including transfer-on-death designations for both real estate and vehicles, recognition of holographic wills, and informal probate procedures for qualifying estates. The state’s substantial compliance doctrine also provides flexibility by allowing documents to be treated as wills if clear and convincing evidence shows the decedent intended them as such.
With no state estate or inheritance taxes, Montana provides residents with a favorable environment for estate planning. The state’s spousal protection laws ensure that a surviving spouse receives a fair share of the estate, with generous statutory minimums ($300,000 plus three-quarters of the remaining estate in some cases) for intestate estates.
When any out-of-the-ordinary issues are present, it’s advisable to consult with an experienced attorney familiar with and licensed under Montana law to ensure your estate plan takes full advantage of the state’s provisions while avoiding potential pitfalls.
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FAQs: Montana Wills and Trusts
Q: What are the requirements for a valid will in Montana?
A: A Montana will must be in writing, signed by the testator (18+ and of sound mind), and signed by at least two witnesses who see the testator sign or hear them acknowledge the signature. Witnesses must sign within a reasonable time. Holographic wills, entirely in the testator’s handwriting and signed, are also valid without witnesses.
Q: Does Montana have estate or inheritance taxes?
A: No, Montana does not impose state estate or inheritance taxes. Large estates may still face federal estate taxes, but there’s no additional state-level tax burden.
Q: What are transfer-on-death (TOD) deeds and vehicle titles in Montana?
A: Montana allows TOD designations for real estate and vehicle titles (since October 2021). These let you name a beneficiary who inherits the property or vehicle upon your death without probate, while you retain full control during your lifetime.
Q: How can I avoid probate in Montana?
A: You can avoid probate in Montana with a living trust, joint ownership with right of survivorship, TOD deeds for real estate, TOD vehicle titles, or payable-on-death designations for bank accounts and securities. Informal probate is also an option for qualifying estates.
Q: What protections do surviving spouses have in Montana?
A: Montana offers a spousal elective share of 50% of the marital portion of the augmented estate, adjustable to a $75,000 minimum. Without a will, a spouse gets the entire estate if there are no kids or parents, or $150,000-$300,000 plus a share of the rest, depending on other heirs.
Q: What is a holographic will, and is it valid in Montana?
A: A holographic will is handwritten and signed by the testator. Montana recognizes these as valid if all material provisions are in the testator’s handwriting, even without witnesses, offering flexibility for simple estate plans.
