Identifying the trustee, the person who holds the assets of the trusts and administers them for the beneficiaries’ benefit, must be identified. It is also important to identify these beneficiaries.
Sometimes, they are clearly identified. Other times beneficiaries are generally identified as a class of people such as children, grandchildren or great-grandchildren which are identified as descendants or issue.
Asset distribution can be done many ways. A trustee may have to distribute all the assets at once to a specific beneficiary, to several beneficiaries or in installments over time. There are trusts where the trustee has complete discretion over distributions and cannot withdraw trust assets. Some trusts allow trustees to distribute income and principal.
Trusts have different ending dates. These may continue until a specific date or when a certain event occurs, such as a beneficiary’s or other person’s death. Trustees may also have to provide accountings to beneficiaries which allow transparency about the assets placed into the trust and who receives payment of the assets.
A revocable trust allows its donor to change it. An irrevocable trust may not be changed. A previously revocable trust may not be changed and becomes irrevocable when the original donor dies.
Trusts also have tax implications which may be complicated. Provisions concerning trustee powers, closely held stock and qualified retirement accounts may also be complex. An attorney can explain and provide guidance on these issues and help assure that trusts are property and legally drafted.