A testamentary trust manages the assets of someone who is deceased. It is created through their Last Will and cannot be implemented until their death. Reasons to establish a trust are to make provisions for minor children, someone with special needs, and even charities.
A testamentary trust lawyer is skilled in setting up a testamentary trust. They understand the issues related to choosing a trustee, funding the trust, and putting the appropriate measures in place to ensure the integrity of the trust.
Identifying The Elements Of A Testamentary Trust
The four parties involved in a testamentary trust include the:
- Probate Court
The grantor is sometimes referred to as the trustor or settlor and the testamentary is created through their will. They select a trustee to manage their assets. Upon the death of the grantor, the will goes through the probate court to verify its validity and the trustee then manages the assets until it is time to distribute them. The beneficiaries are those who receive the property and funds from the trust. The probate court monitors the testamentary trust throughout its existence.
Considering The Advantages Of A Testamentary Trust
A testamentary trust gives the grantor control over how their assets are managed after their death. It is relatively inexpensive to set up and easy to establish as part of the will. The terms of the trust are flexible. The assets remain protected until a child beneficiary reaches a specific age or completes their education.
It is possible to fund the trust with life insurance proceeds after the death of the grantor. To accomplish this, the grantor names the beneficiary of the insurance policy as a trustee of the testamentary trust. At the time of their death, the life insurance policy pays into the trust.
Knowing The Disadvantages Of A Testamentary Trust And How They May Affect The Estate
Upon creation the Trust, the grantor makes their wishes known to the person they designate as trustee. However, once they are deceased, they no longer have any influence over the trustee. It can be difficult for the beneficiaries to challenge a trustee they believe is not acting in their best interests and it may be necessary to obtain the services of trust litigation lawyers to handle the matter.
The trustee checks in with the probate court annually until all of the beneficiaries of the trust receive the assets and fees are associated with probate court. If the trust continues for many years, the court costs can be significant.
The grantor can name a relative or trusted friend to act as trustee. However, the person named as trustee is under no obligation to assume the responsibility and may refuse the request to be trustee. In that case, the probate court appoints someone to act as trustee or a relative or friend assumes the role.
If you are considering adding a testamentary trust to your will, it is wise to contact a trust lawyer for guidance. Some of the best testamentary trust lawyers and attorneys in the country practice in Tampa, Florida who can answer your questions and advise you about setting up a testamentary trust.
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