How to Set Up a Blind Trust

By Michael Butler

People, including judges, politicians and business executives, use blind trusts to avoid conflicts of interest because in a blind trust the beneficiary does not know how the trustee handles the assets of the trust. Lottery winners sometimes use blind trust to preserve anonymity. In other aspects, blind trusts are the same as other types of trusts.

Step 1

Read the trust laws in your state or consult with a licensed attorney. Trusts are established as a matter of state law, so you need to follow the proper procedures for your state.

Step 2

Gather the documentation for the assets you want to transfer to the trust after it is formed.

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Step 3

Appoint a trustee. Remember that you will be blind as to how the funds in the trust are handled, so your trustee should be trustworthy and financially responsible. If you do not know someone personally that you want to name as the trustee, hire a bank, trust company or attorney to act as the trustee. You may also want to appoint a backup trustee should something happen to your first selection.

Step 4

Draw up the trust agreement. It is advisable to have an attorney draft the trust agreement for you to insure that it works as intended. Make sure the trust documents indicate how the trustee should disperse assets to you and include when the trust ends. Both depend on your reason for needing a blind trust. A blind trust can be either revocable or irrevocable.

Step 5

Sign and notarize the trust agreement. If your state has trust recording laws, follow them to report the trust to the state.

Step 6

Transfer the assets to the blind trust so that the trustee can begin handling the trust.

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How to Prepare an Amendment to a Revocable Trust

References

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How to Make a Family Trust

A living family trust is a plan that controls the assets placed into the trust fund. A revocable living family trust is an agreement you can end at any time before death. An irrevocable living family trust can't be terminated except under circumstances allowed by state law -- and you usually need a court order. Both types offer drawbacks and advantages, but family trusts are commonly revocable because the trust owners retain ownership rights to the assets. You can create a family trust for any purpose -- and you can serve as the trustee of the revocable family trust.

Requirements in Illinois for Revocable Living Trusts

A revocable living trust transfers property from a living grantor, or creator, to a trustee through a written agreement. The trustee manages the property and distributes it to individuals, known as beneficiaries, subject to specific terms. A revocable trust allows the grantor to change the terms whenever he wants; an irrevocable trust does not. Illinois does not require that you file any documents with a state agency to create a valid revocable living trust, but you must meet several other requirements.

How to Fire a Trustee

A trustee is powerful -- he must manage trust property and distribute trust assets to trust beneficiaries in accordance with the terms of the trust. Therefore, knowing how to fire a trustee if and when he abuses his position is vital. Generally, the power to fire a trustee depends on the terms of the trust, state law and the wishes of the trust's beneficiaries and grantor -- that is, the person who created the trust.

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