If you are interested in learning more about trusts, a West Palm Beach estate planning lawyer will explain the different types and their purposes. A trust is a legally recognized relationship in which one person (known as the trustee) legally holds property for another’s benefit. That other person is known as the beneficiary.
A trust is created when legal title of assets is transferred to the trustee from a property owner (the settlor). Then this trust is held and managed for the beneficiaries.
Individuals Involved in a Trust
A West Palm Beach planning attorney will explain in detail to you the functions of the three different types of people involved in a trust:
- The settlor or settlors: Those who create and/or contribute to the trust.
- The beneficiary or beneficiaries: Either those who will benefit from the trust, or is in charge of the trust.
- The trustee: The officiant of the trust itself.
As a West Palm Beach estate planning lawyer will tell you, there are three different kinds of trusts:
- Testamentary trust
- Revocable inter vivos trust
- Irrevocable inter vivos trust
This is created in a will and usually becomes active at death, or sometime in the future. Inter vivos trusts are created during the life of the settlor. A West Palm Beach estate planning lawyer will tell you that these are divided into two categories:
- Revocable Inter Vivos Trust
These are known as “living trusts,” where assets are managed while the settlor is still alive. After death of the settlor, these assets are released and distributed according to the wishes expressed in the trust.
- Irrevocable Inter Vivos Trust
These are primarily used to protect assets from creditors.
Your West Palm Beach estate planning lawyer will advise that a spendthrift provision can be included in the trust. This means that a beneficiary may not transfer interest in the trust, and a creditor cannot utilize this interest until it is received by the beneficiary.
For Legal Assistance
For more information on trusts, contact West Palm Beach estate planning attorney Al Morici, Attorney at Law, at 561-471-2551.