A trust is a legal arrangement where one or more people (trustors, grantors, or settlors) create and subsequently transfer property into a trust by delivering the assets to another (called the trustee) to hold and manage the property for the benefit of another (usually called beneficiaries). This is a very basic description of a legal fiduciary relationship that is further described according to your state statute under trust and estate law.
Document that creates trust, designates trustee and gives related powers and authority to trustee to serve in fiduciary capacity, and spells out how trust funds should be managed and may or will be used for beneficiaries.
Individual or entity named to serve as fiduciary on behalf of trustor.
The primary responsibilities of the trustee are to manage and protect the assets in the trust for the best interests of the beneficiaries. The management and protection responsibilities include proper investment of assets, collection of income, maintenance of accurate books and records, coordinating preparation and filing of tax returns and other reports, and payment of income and trust property to the beneficiaries in accordance with the terms of the trust agreement.
You will want to contact your attorney (or call a few estate planning attorneys if you don’t already have one) to get an estimate of the legal fees.
Typically a corporate trustee’s annual fees are based on a percentage of the trust’s assets under management, although a few states do set a fixed amount for trustee compensation. D.A. Davidson Trust Company’s trustee fees are very competitive. If D.A. Davidson Trust Company is named to serve in a future capacity, our fees would only apply once we started serving in that capacity. (The more prudent question may be to ask yourself how much it could potentially cost NOT to use a corporate trustee).
The Trust & Fiduciary Advisors at D.A. Davidson Trust Company welcome the opportunity to speak with you. We also suggest that you discuss a trust with your D.A. Davidson financial advisor.
There are many different kinds of trusts to consider depending on the goal(s) of the person creating the trust and the purpose that trust is meant to fulfill. Types of trusts include a revocable living trust that is created for your own assets and care during your life, or you can add provisions for a testamentary trust in your will that would only be created upon your death. Some may desire to create irrevocable trusts for gifting purposes. This can include Charitable Trusts, and when applicable, a Special Needs Trust could be set up for a child or grandchild to help preserve access to other governmental benefits. Additional trust solutions are available for those with even more complex estate planning. For those interested, D.A. Davidson Trust Company is able to help you consider which type of trusts may be appropriate for your given situation in coordination with your attorney.
Avoid probate, retain control of the assets during your life, and protect assets and yourself if you become disabled.
Avoid probate, give up control of certain assets to reduce your taxable estate, and potentially provide creditor protection.
Leave assets to beneficiary in trust to assure professional management, protect assets from creditors and ex-spouses, and reduce estate taxes on beneficiary’s death.
Can be used to transfer assets at reduced estate and gift tax cost.
Can be used to transfer a residence (or values of residence) at reduced estate and gift tax cost.
Provide for maximum use of the unified credit in the estate of both spouses.
Provide income from trust assets to your spouse for life and qualify for the marital deduction, but upon your spouse’s death, retain control over who will receive assets.
Maximize use of appreciated assets, provide income to you or other family members, and then gift assets to charity to receive a current income tax charitable deduction.
Provide income to charity and ultimately can be used to transfer trust assets to children or grandchildren at a greatly reduced gift and estate tax cost.
Leave insurance proceeds to beneficiaries gift and estate tax free.
Leave assets to your grandchildren while taking advantage of the exemption from the generation skipping tax. GST is the same figure as the Estate exemption.
Maximize protection of assets from potential creditors while retaining benefits and control, using foreign jurisdictions.
Used to increase gifted assets to younger generation without additional gift taxes.
To allow gifts to qualify for the annual gift tax exclusion.