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What is a Trust?

A trust is a legal relationship where the owner, or trustor, gives another party, the trustee, the right to hold title to property or assets for the benefit of a third party, the beneficiary. A trust is traditionally used for minimizing estate taxes and offers other benefits as a part of an estate plan.

What is the Purpose of a Trust?

While most typically associated with estate planning, trusts are created more broadly for the purpose of achieving certain goals in the transfer of assets. Many common goals in creating a trust include the reduction of estate taxes, avoidance of probate, and to ensure asset protection. Depending on the specific goals of the trust, a number of structures exist and specific details must be taken into consideration.

What are the Different Kinds of Trusts?

Because of the many reasons trusts are created, a wide variety of structures exist in order to achieve different goals. 

How are Trusts Taxed?

All trusts are taxed differently depending on a few details about their structure. A trust is a separate legal and taxable entity, and whether or not the trust pays income tax depends on if it is a simple trust, complex trust, or grantor trust.

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