Memorandum Of Wishes Template for the United States

A Memorandum of Wishes is a non-binding document that accompanies your trust, providing trustees with detailed insight into your personal intentions, values, and preferences for trust administration. While not legally enforceable under United States law, this document serves as invaluable guidance for trustees when exercising their discretionary powers, particularly in situations not explicitly covered by the formal trust deed.

When do you need this document?

You need a Memorandum of Wishes when establishing any discretionary trust where trustees have significant decision-making authority over distributions and beneficiary treatment. This is particularly important for family trusts, charitable trusts, and generation-skipping trusts where complex family dynamics exist. The document becomes essential when you want to communicate sensitive information about beneficiaries' circumstances, your philanthropic intentions, or specific wishes about asset management that might be inappropriate to include in the public trust deed. You should also consider creating this memorandum when establishing trusts with multiple beneficiaries across different generations, as it helps trustees understand your priorities and reasoning for potential distribution decisions.

Key legal considerations

Under United States trust law, your memorandum must clearly state that it is non-binding and advisory only to avoid unintentional creation of legally enforceable obligations. You should carefully balance providing detailed guidance while preserving trustees' discretionary authority, as overly specific instructions might conflict with the trust's flexibility. The document should align with your trust's tax objectives under the Internal Revenue Code, particularly regarding grantor trust status and estate tax implications. Consider confidentiality provisions, as the memorandum often contains sensitive family information that you may not want disclosed to all beneficiaries immediately. You should also address how updates to the memorandum will be communicated to trustees and whether previous versions should be revoked.

Legal requirements in United States

While no federal law mandates the format or content of a Memorandum of Wishes, state trust laws may influence how trustees can consider and act upon your guidance. Under the Uniform Trust Code adopted by many states, trustees have a duty to administer trusts in good faith and in accordance with the trust's purposes, making your memorandum a valuable reference point. The document should be properly dated and signed, with clear identification of the relevant trust and trustees. Federal tax considerations under IRC Sections 671-679 may affect how you express certain wishes to maintain desired grantor trust treatment. Some states require trustees to provide beneficiaries with information about trust administration, so consider whether your memorandum contains information that should remain confidential. Ensure your memorandum doesn't inadvertently create binding obligations that could affect the trust's legal structure or tax status.