Today, creating a trust can be a complex endeavor. Instead of assigning one person as the trustee or two people as co-trustees, it may be necessary to have entire groups of people overseeing the execution of an irrevocable trust. For instance, there may be a need to have a trustee protector who determines whether or not a remove or replace a trustee. This person may also be able to move a trust, which could impact its governing law.
A trust may also need a loan director who makes loans to the settlor of the trust. This may be a worthwhile role to have as it can turn the trust into a grantor trust. Doing so may enable the income from the trust to be taxed to the settlor instead of to the trust itself. Adding a charitable selector to the trust may make sense for those who may wish to donate money or assets to charity.
Who gets a certain asset and when can may need to be a strategic decision as it could trigger a taxable event. Therefore, it may be best to assign an outside financial institution to act as a distribution committee for the trust. However, a trust may name any person or group of people to determine how and when distributions are made from the trust to a beneficiary.
While wills are commonly used for basic estate planning purposes, trusts can play an important part as well. They may be an appropriate option for those who are looking to keep the details of their estates private. An estate planning attorney can outline the laws that pertain to particular forms of trust documents.