A trust is a legal entity you can create to hold assets and property for the benefit of another individual. The purpose of a trust is to protect, hold, and manage your private wealth for the benefit of your heirs. In order for the intended individual to receive the designated assets, the Trust must be properly formed.
Trust Participants
A validly formed trust names a settlor (sometimes referred to as a trustor or grantor), a trustee, and a beneficiary.
The settlor creates and funds the trust. He then delivers the trust property to the trustee.
The trustee is the individual, institution, or organization that will hold legal title to the trust property for the benefit of the beneficiary. The trustee also manages and administers trust assets. The settlor can serve as the trustee. A settlor may name successor trustees as well.
The beneficiary is the person who is to receive the benefits of the trust. In general, any person or entity may be a beneficiary.
Methods of Creating a Trust
A trust is created by executing a Trust Agreement and transferring property to the Trustee. To fund a trust, property can be transferred to the trustee or titled in the name of the trust during the settlor’s lifetime. Property can also be transferred to a trust upon the settlor’s death by will or some other disposition (such as naming a trust as the beneficiary to a life insurance or retirement fund).
- Requirements for Creation
- the settlor has the mental capacity to create a trust,
- he indicated an intention to create the trust, and
- the trust has a definite beneficiary.
A valid trust is only created if:
The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.