If your club is using the BI or ICLUB sample partnership agreement, you will find a provision (currently in item 16, Addition of Partners) for handling revocable trusts:

(a) Transfers to a Trust. A partner may, after giving written notice to the other partners, transfer his interest in the partnership to a revocable living trust of which he is the grantor and sole trustee.

When this change happens:

• Navigate to the People page of myICLUB, and click the member's name.
• Click the Edit Profile button, near the bottom of the page.
• Use the Partner Entity drop-down and change it to Trust
• Enter the name of the trust
  • Some trusts will have longer names than others; for tax purposes, the minimum required is the name of the trustor, the word “Trust” and the date of the trust agreement.
• Click Save Changes near the bottom of the screen, and the entry will be saved.

Once this is done, the member's name will still appear on all club reports, but when producing forms with our tax printer, the member's name will be replaced with the name of the trust as it is entered on the Profile page.

At the partner’s death (or when any future withdrawal is made), the payment is made payable to the Trust, not the Trustee (who would be someone other than the member upon the trust owner’s death). The Trustee has the responsibility and authority to determine the use of the payment.

This is the only commonly used method of accommodating heirs in an investment club . We don’t recommend joint ownership or “beneficiaries.” Beneficiaries can be problematic for a number of reasons, including problems that may arise from conflicts in a will or other claimants to a deceased’s property, so clubs should steer clear.

Members who take advantage of a revocable living trust will have to work with their own estate/financial planner in order to get it in place, but historically they are not very complicated or expensive to create.