Deconstructing a Trust Document

January 29, 2020

A trust is a document created by a grantor that holds assets and appoints a trustee to manage those assets for the benefit of the intended beneficiaries. Here are a few tips to help you read and understand a trust document:

· Identify all the parties. Who is grantor? The person creating the trust. Who are the beneficiaries? Those who receive the assets and/or income from the establishment of the trust. Who is the trustee? The person (or corporate fiduciary) who manages the assets and distributes them according to the terms of the trust.

  • Is the trust revocable or irrevocable? If the trust is revocable, the grantor is allowed to make changes or terminate it completely. If the trust is irrevocable, the grantor will not be able to make any changes.
  • Determine when the trust ends. Is it a certain date or upon the happening of an event?
  • How are the assets to be distributed and does the trustee have any discretion with regard to distributions?
  • What are the accounting requirements?
  • Also review the boiler plate language regarding the laws that impact the trust, tax concerns and modification requirements.

For assistance in reviewing or creating trust documents in the Greater Baltimore area, please contact Stouffer Legal at 443-470-3599.

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