A trustee, also known as a grantor, settler or creator, creates a trust by granting assets to beneficiaries. The trustee manages and administers the assets until ownership is transferred. The trustee sets the terms of the trust and signs a trust agreement, which details instructions on how to manage the trust. A trust can be created during the life of the creator or as part of a will. A trust attorney can advise on the best type of trust to create based on individual circumstances and tax consequences.
A trustee, also called a “grantor”, “settler” or “creator”, is the person who creates a trust. This person grants real estate, personal property, money and gifts to the beneficiaries in the trust. Sometimes he may be referred to as a “giver”, as he is conceding something to another party. The names vary by jurisdiction, but the definition and role are essentially the same.
A trust is a legal document in which a person provides assets to beneficiaries and directs a trustee to manage and administer the assets until ownership is transferred and the trust is no longer in existence. When the trustee and the trustee are the same person, it is referred to as a grantor trustee. A beneficiary receives the property or income under the terms of the document, which can be spread over years or given in a lump sum when certain conditions are met. In some cases, the grantor may also be a beneficiary.
The trustee usually sets the terms of the trust and signs a trust agreement. The agreement details instructions to the trustee on how to manage the trust. Any agreement involving land must be written to be enforceable, but others can be oral or even implied. The agreement often stipulates how the trust’s capital and income are to be invested and paid out to the beneficiaries. The trustee must adhere to the agreement when administering his duties, or may be sued by the beneficiaries for breach of duty under the trust law.
A trust can be created during the life of the creator, which is called a living trust. The main benefit of establishing a living trust is to avoid the need to go to probate. Another option is to create one as part of a will, which is a testamentary trust. This type can and often does in probate, because the assets must go through the estate. The trustee may revoke, amend or cancel a living or testamentary trust, except in the case of an irrevocable living trust.
A grantor often creates a trust to supersede a will, but it can also be part of a will. A trust attorney can advise individuals on the best type of trust to create, based on the individual’s circumstances, the law that will govern the trust and the tax system that affects it. Giving gifts up to a certain amount may be a better alternative, depending on the recipients and tax consequences.
Protect your devices with Threat Protection by NordVPN
