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7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
TRUST BENEFICIARIES
HAVE RIGHTS
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
TRUST BENEFICIARIES HAVE
RIGHTS
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
A beneficiary is a person who receives
monetary gain or the benefit from
something, such as a trust, will, or life
insurance policy.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
When a trust involved,
beneficiaries typically have rights
which ensure the trust is properly
managed for their benefit.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
WHAT IS A TRUST?
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Trusts are agreements based between the trustee
or trust asset manager and the grantor, who is the
person making the trust.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
The trust agreement authorizes the
trustee to administer the trust
assets and distribute them to the
beneficiaries named in the trust,
according to the terms of the trust
document.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
THE PRIMARY BENEFITS OF A TRUST
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Like a last will and testament, a trust can provide
a way for you to determine now how and when
your property will be distributed to the people
whom you chose upon your death.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
A trust can also give you a way to
protect and distribute assets in
situations where a particular
beneficiary may need special
assistance in managing that
property.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Another advantage is that a trust
can help you avoid the time and
expense of the probate process.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
HOW AN IRREVOCABLE TRUST IS
DIFFERENT FROM A REVOCABLE TRUST
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
By definition, an irrevocable trust is
different because it cannot be modified after
it has been executed.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Nevertheless, there are very
favorable tax consequences
inherent in irrevocable trusts.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
For example, transferring assets to
an irrevocable trust, may protect
them from the reach of creditors,
estate taxes, and probate
proceedings.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
While you lose some control of your
assets funded in an irrevocable
trust, you gain other benefits.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
TAX ADVANTAGES FOR A TRUST
BENEFICIARY
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Certain types of trusts can provide
tax advantages for both the grantor
and the beneficiary.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
These particular types of trusts
include "credit shelter" trusts or
"life insurance" trusts.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
There are also types of trusts that
can be used to protect property
from creditors, as well as, to
preserve the grantor’s eligibility for
Medicaid.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
TYPES OF BENEFICIARIES
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
If you happen to be the beneficiary
of an irrevocable trust, then you
have a right to certain information
about the trust and the right to take
steps to ensure the trustee is
properly fulfilling his or her duties.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
The extent of these rights will
depend on the terms of the trust
agreement, the law of the state the
trust is created in, and on the type
of beneficiary you are: either
current or remainder.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
CURRENT BENEFICIARIES
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Current beneficiaries are those who
are presently entitled to income or
principal from a trust.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
On the other hand, remainder (or
contingent) beneficiaries only have
an interest in the trust once the
current beneficiaries' interest has
ended.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
For instance, one spouse may
establish a trust that leaves income
to the other spouse for life.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
The spouse beneficiary would be
considered the current beneficiary.
The remainder of the property may
then be left to the children, who are
considered the remainder
beneficiaries.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
BASIC RIGHTS OF A CURRENT
TRUST BENEFICIARY
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
The specific rights that a beneficiary may have are
determined by the terms of the trust document,
as well as the trust laws in your state.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Current beneficiaries have the right
to payment of distributions as set
out in the trust document.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
They also have a right to receive
sufficient information about the
trust and its administration to be
able to enforce their rights.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Current beneficiaries have a right to
an accounting, which is a detailed
report of all income, expenses, and
distributions from the trust.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
In most cases, trustees are required
to provide an annual accounting
depending on the terms of the trust.
Beneficiaries may also be able to
waive the accounting.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
RIGHTS SHARED BY CURRENT
AND REMAINDER BENEFICIARIES
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Current and remainder beneficiaries have a right
to petition the court for the removal of the trustee
if there is a concern that the trustee is not acting
in the best interest of the beneficiaries.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Although it can be difficult, trustees
are obligated to balance the needs
of the current beneficiaries with the
needs of the remainder
beneficiaries.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
Also, when all current and
remainder beneficiaries agree, a
petition can be filed with the court
to terminate the trust in certain
situations.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
The trust laws in each state may
vary on this issue. Typically, when
the purpose of the trust has been
fulfilled, or is impossible to fulfill,
the trust can be terminated.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
CONTACT US!
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
If you have questions regarding the
rights of a trust beneficiary, or any
other estate planning needs, please
contact The Vermillion Law Firm,
LLC for a consultation either online
or by calling us toll free at
(888) 567-5745.
7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560
(972)386-4560
www.VermillionLawFirm.com
The Vermillion Law Firm, LLC

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Trust Beneficiaries Have Rights

  • 1. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 TRUST BENEFICIARIES HAVE RIGHTS
  • 2. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 TRUST BENEFICIARIES HAVE RIGHTS
  • 3. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 A beneficiary is a person who receives monetary gain or the benefit from something, such as a trust, will, or life insurance policy.
  • 4. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 When a trust involved, beneficiaries typically have rights which ensure the trust is properly managed for their benefit.
  • 5. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 WHAT IS A TRUST?
  • 6. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Trusts are agreements based between the trustee or trust asset manager and the grantor, who is the person making the trust.
  • 7. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The trust agreement authorizes the trustee to administer the trust assets and distribute them to the beneficiaries named in the trust, according to the terms of the trust document.
  • 8. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 THE PRIMARY BENEFITS OF A TRUST
  • 9. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Like a last will and testament, a trust can provide a way for you to determine now how and when your property will be distributed to the people whom you chose upon your death.
  • 10. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 A trust can also give you a way to protect and distribute assets in situations where a particular beneficiary may need special assistance in managing that property.
  • 11. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Another advantage is that a trust can help you avoid the time and expense of the probate process.
  • 12. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 HOW AN IRREVOCABLE TRUST IS DIFFERENT FROM A REVOCABLE TRUST
  • 13. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 By definition, an irrevocable trust is different because it cannot be modified after it has been executed.
  • 14. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Nevertheless, there are very favorable tax consequences inherent in irrevocable trusts.
  • 15. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 For example, transferring assets to an irrevocable trust, may protect them from the reach of creditors, estate taxes, and probate proceedings.
  • 16. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 While you lose some control of your assets funded in an irrevocable trust, you gain other benefits.
  • 17. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 TAX ADVANTAGES FOR A TRUST BENEFICIARY
  • 18. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Certain types of trusts can provide tax advantages for both the grantor and the beneficiary.
  • 19. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 These particular types of trusts include "credit shelter" trusts or "life insurance" trusts.
  • 20. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 There are also types of trusts that can be used to protect property from creditors, as well as, to preserve the grantor’s eligibility for Medicaid.
  • 21. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 TYPES OF BENEFICIARIES
  • 22. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 If you happen to be the beneficiary of an irrevocable trust, then you have a right to certain information about the trust and the right to take steps to ensure the trustee is properly fulfilling his or her duties.
  • 23. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The extent of these rights will depend on the terms of the trust agreement, the law of the state the trust is created in, and on the type of beneficiary you are: either current or remainder.
  • 24. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 CURRENT BENEFICIARIES
  • 25. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Current beneficiaries are those who are presently entitled to income or principal from a trust.
  • 26. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 On the other hand, remainder (or contingent) beneficiaries only have an interest in the trust once the current beneficiaries' interest has ended.
  • 27. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 For instance, one spouse may establish a trust that leaves income to the other spouse for life.
  • 28. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The spouse beneficiary would be considered the current beneficiary. The remainder of the property may then be left to the children, who are considered the remainder beneficiaries.
  • 29. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 BASIC RIGHTS OF A CURRENT TRUST BENEFICIARY
  • 30. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The specific rights that a beneficiary may have are determined by the terms of the trust document, as well as the trust laws in your state.
  • 31. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Current beneficiaries have the right to payment of distributions as set out in the trust document.
  • 32. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 They also have a right to receive sufficient information about the trust and its administration to be able to enforce their rights.
  • 33. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Current beneficiaries have a right to an accounting, which is a detailed report of all income, expenses, and distributions from the trust.
  • 34. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 In most cases, trustees are required to provide an annual accounting depending on the terms of the trust. Beneficiaries may also be able to waive the accounting.
  • 35. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 RIGHTS SHARED BY CURRENT AND REMAINDER BENEFICIARIES
  • 36. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Current and remainder beneficiaries have a right to petition the court for the removal of the trustee if there is a concern that the trustee is not acting in the best interest of the beneficiaries.
  • 37. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Although it can be difficult, trustees are obligated to balance the needs of the current beneficiaries with the needs of the remainder beneficiaries.
  • 38. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 Also, when all current and remainder beneficiaries agree, a petition can be filed with the court to terminate the trust in certain situations.
  • 39. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 The trust laws in each state may vary on this issue. Typically, when the purpose of the trust has been fulfilled, or is impossible to fulfill, the trust can be terminated.
  • 40. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 CONTACT US!
  • 41. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 If you have questions regarding the rights of a trust beneficiary, or any other estate planning needs, please contact The Vermillion Law Firm, LLC for a consultation either online or by calling us toll free at (888) 567-5745.
  • 42. 7616 LBJ Freeway #120, Dallas, TX 75251Phone: (972) 386-4560 (972)386-4560 www.VermillionLawFirm.com The Vermillion Law Firm, LLC