It is not uncommon for people to be confused about how a trust is legally defined and how it works within the legal system. Hyannis Estate and Trust Administration has some nice tips on this. A trust refers to properties given to a trustee to administer for the benefit of another person, who is recorded in the official legal paper documents. In most cases the beneficiary receives interest and dividends for a predetermined amount of time on the trust assets, and this is typically for a number of years. Under the terms of a trust, an agreement is concluded in which one person transfers the title they hold to a particular property to another person who agrees to manage it for third parties. This is a beneficial process as the entity that has changed the title (the beneficiary) will profit greatly from having another individual supervise it for them.
An individual may control the distribution of his or her property by setting terms and conditions within a written confidence. This can then be used while living or following their death.
There are many different trust types, having different purposes and functions. A trust may be for the benefit of the person who created the trust, or it may be for the benefit of their surviving spouse or minor children, or for a charity. All trusts formed with the purpose of evading investors or other legal obligations will however be voided by the courts. In general trusts are created in anticipation of their death during a person’s lifetime. This can be done early in life or later in life, and as long as a qualified real estate lawyer is involved in helping, changes can be made as time goes on. Trusts are the perfect way to ensure that the plans you have for your assets-money , property, etc.-are executed successfully once you have passed through, and can no longer ensure that they are executed in the manner you originally wanted.
The person who creates a trust is the settlor, whereas the one who controls the property for the benefit of another party is considered the trustee. It is the beneficiary, not the trustee, who benefits from the Trust.
A trustee has a duty to act with absolute integrity and good faith as to managing the trust and serving the interests of the trust’s beneficiaries. A breach of the duty of the trustee, known as a fiduciary duty, may result in negative consequences including a court action and even criminal charges. It is therefore very important for a legal professional to be involved in the process to ensure that there are no unintentional breaches that could wreak havoc down the line.
You assume a large responsibility when you have agreed to be a trustee, which you must carry out in full compliance with the law. An attorney can help you in more ways than one by making sure you follow all the proper protocol so that you abide by the law. In addition, if you encounter an IRS investigation, or if any of the beneficiaries bring you to court, an attorney can protect your rights in a lawsuit.
As a trustee, you have other responsibilities that include: holding the funds in a different trust account, preventing conflicts of interest, controlling the funds and making sure they get any sort of financial gain while preventing high-risk transactions, maintaining outstanding records, charging taxes on all trust profits, and taking very good care of the beneficiaries.
If you accept a significant legal obligation, working with an attorney is in your best interests. This is particularly true when it comes to planning for estate and trust administration matters. Under such situations, you will be asked to manage the properties kept within a trust, and as such, you will be performing exactly the same obligations as a legitimate land owner. It is, in essence, a form of possession, either of personal property or immovable property; the distinction being that it is a property that is being shared between the trustee and the individual who assigned their property to them. This is then up to the trust trustee to supervise the trust as established by the owner of the initial trust, including the allocation of properties etc. Because this process is complex and highly personal in nature, it is one that must be handled with the utmost care and attention. Therefore, taking measures to ensure that you act under a professional real estate attorney’s legal guidance could make a world of difference in how your case plays out. An attorney for the planning of estate in Orange County can provide you with invaluable counsel regarding your legal obligation and trust administration responsibilities. They will even inform you what precautions you should take after your term as trustee to stop making some expensive legal errors.