There are several different kinds of Trusts available to help in financial and tax management. In general, a Trust is a financial tool that allows a trustee to hold assets on behalf a single beneficiary (or a group of beneficiaries) for their benefit, while keeping control over the assets. Trusts are a powerful tool. Our experienced lawyers can help you set up and maintain any Trust arrangement that is beneficial to you or to those in your care. Call our Thornhill, Ontario office today at 905-597-8529.
How do Trusts Work?
A Trust is a financial agreement among three parties: a settlor, a trustee or trustees, and a beneficiary. The settlor is the person who establishes and deposits assets into the trust. The settlor also determines how the assets are to be used or managed, and who will benefit from the trust. The second person or group of people involved in a Trust agreement is the trustee(or trustees), who is appointed by the settlor to manage and control the assets in the Trust for the third entity in the Trust agreement: the beneficiary. The beneficiary is a person or group of people, also named by the settlor, who will benefit from the assets of the trust. It is not required that the settlor, trustee, and beneficiary be different people; in fact, all three can be the same person. In this way, the ownership of assets can be separated from control of those assets.
What Types of Trusts Are There ?
There are several types of Trusts that a lawyer from K&Y can help you to establish. A Living Trust is a Trust set up during a person’s lifetime, and is used to transfer ownership of assets to a beneficiary, while still maintaining control of those assets. These can be useful, for example, when a settlor wants to transfer ownership of assets to minor children who are not yet ready to control the assets themselves, or to a family member with special needs that preclude them managing their own assets. This can have tax advantages, as well. A second type of personal Trust is a Testamentary Trust, which is established after a death and which continues on after an estate has been administered. Typically, an estate is administered and assets are distributed fully and the estate closed. However, there are situations where the property will continue to be held in trust even after the estate has been administered, and these Trusts are Testamentary Trusts.
Why Should I Hire a Lawyer to Establish a Trust?
The reason you want to establish a trust in the first place is to protect assets for someone whom you want to benefit. Hiring a lawyer to ensure that your Trust is fully legal and executable means that your wishes will be followed, and the beneficiary will , in fact, receive the benefits you intend for them. Call us today at 905-597-8529!