A trust in the state of Texas involves three primary parties: the grantor, the trustee and the beneficiary. The grantor is the person who creates this estate planning tool, whereas the trustee managers the particular property that the trust owns. Meanwhile, the beneficiary is the individual who will experience the benefits of the trust.
Depending on a trust’s purpose, the positions of grantor, trustee and beneficiary may be assumed by one party or by three separate ones. In addition, a trust may have multiple grantors, trustees and beneficiaries. After a trust has been created, it can own property and, in fact, can even have its very own number for taxpayer identification and have to file an income tax return each year.
Various trusts are available, with the most common one being a revocable trust, or living trust. A revocable trust enables the financial affairs of the trust’s grantor to be settled after his or her death without having to involve the process of probate. The grantor essentially is the revocable trust’s trustee and only beneficiary during his or her lifetime.
A trust features instructions regarding how the assets of a grantor should be divided when the grantor passes away. This estate planning device also identifies who will be the successor trustee. After a trust has been created, it is necessary to change the title of one’s assets, such as for cars and real estate, to the trust. Although setting up a trust involves multiple steps and is inherently complicated, a knowledgeable attorney in the state of Texas can help with putting one together that accurately reflects the trust creator’s wishes and needs.
Source: fdlreporter.com, “Easing the Burden: Estate planning, the revocable trust“, Isabell Mueller, March 25, 2017