A testamentary trust is a trust that is established through and governed by a will. It becomes effective only after the grantor’s death. The grantor, also called a testator, is the person who drafted the will. A testamentary trust can be used to exert some control over how assets left in a will can be used after the grantor’s death. A will can set up more than one testamentary trust.
As with any Trust, from the time of the grantor’s death until the expiration of the testamentary trust, the beneficiaries may ask a Court to check to make sure the trust is being handled properly.
Generally, if a person’s estate is small compared to his or her potential life insurance proceeds or other proceeds that will be paid to the estate at death, a testamentary trust may be a good estate planning tool. However, testamentary trusts are not very popular because a living trust can accomplish most of the purposes of a testamentary trust while still giving the grantor some benefit during his lifetime.
A living trust, sometimes called an inter vivos trust (also referred to as a “revocable trust” or “family trust”), is a trust that is established during the lifetime of the grantor. At the grantor’s death, the assets pass to the trust beneficiaries. Living trusts are estate planning tools that are often used in combination with a will, with the goal of avoiding probate. Under Utah law, a living trust may be either revocable or irrevocable.
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.