A trust agreement lets you put your assets in the control of one person for the benefit of another. When you set up a trust, you name these beneficiaries and place assets into the control of a trustee, the person responsible for managing the trust according to your instructions. When you set up a trust, you will need to make plans for a successor trustee to take over in case the original trustee dies or becomes otherwise incapacitated.
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Legal Forms of Trust
There are many different reasons to set up a trust and many different types of trusts to choose from. To best serve your purposes, you may choose a living trust (created while the grantor is still alive), a testamentary trust (created by a will, after death) or an irrevocable trust (one that cannot be changed once it is in effect). The agreement that sets up a trust must name a trustee, the person responsible for handling the trust's assets. As the grantor, the person who creates the trust, you are at liberty to choose the trustee, be it yourself, your spouse, a friend, an attorney or an organization. Only the grantor needs to sign the trust document, which must also be witnessed and notarized. You should notify the trustee of the appointment, but the trustee does not need to sign the document.
A trust should also name a successor trustee, a person responsible for acting as trustee if the original trustee dies or becomes incapacitated. There can be one or more successor trustees; the grantor can name two people to act in tandem as successors or designate several consecutive successors. The successor should be notified of his appointment and the terms of the successor clause in the document. Like the original trustee, the successor trustee does not need to sign the trust agreement.
Should the original trustee become incapacitated, the successor trustee will need to step in. The trust should have instructions for notification of the successor trustee; state law usually requires that a doctor certify the incapacity in order for the succession to take place. The grantor should make all successor trustees aware of the location of the trust, a copy of which should be kept safely with an attorney, in a personal safe or in a safe deposit box.
Acts of the Successor
A successor trustee must take responsibility for trust assets, including insurance policies, real estate, cash in bank accounts, investments, and all other property contained within the trust. He may also have to make health care decisions for the grantor and deal with relatives and beneficiaries if the grantor has passed away. This can be a heavy burden that can be lightened with clear legal authority to act. A good way to do this is to have the attorney who drafted the trust agreement create a certificate of trust and file it with a court having jurisdiction.
References & Resources
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