Creating a trust can be an effective and efficient way to move property from one party to another. Not only can this help avoid a potentially costly and lengthy probate process, but it can also bring tax benefits for a trust maker, known as a settlor, and help make them eligible for government benefits.
However, there are always key questions to answer when considering the formation of a trust. What property will you place in the trust, and what effect will this have on your finances? Do you want to be able to change the trust in the future? Who will serve as trustee for the trust and ensure that the property moves to the beneficiaries at the proper time?
A Rosenberg trusts lawyer can help you answer these questions. At Romano & Sumner, our experienced trusts and estates attorneys can explain your options, advise on what form of trust is right for your situation, and draft the necessary documents.
A trust is a document that allows a settlor to transfer property to another party. They accomplish this by drafting documentation that outlines their intent, names a trustee to oversee the process, and names one or more beneficiaries to receive the property in the future. Outside of this basic framework, a trust can contain almost any provision that a settlor desires.
That being said, there are some legal requirements for creating a trust. According to Texas Property Code § 112.001, a party may create a trust by transferring property to another with the intent that that other party serves as a trustee. Alternatively, a property holder may declare that they are holding the property as a trustee. Additionally, the settlor must have the intent and mental capacity to create this arrangement. A seasoned attorney can provide more information about the legal processes and requirements for creating trusts in Rosenberg.
A major part of trust creation involves selecting the right trustee to oversee the process. A trustee may be a natural person or an organization. This party has the sole authority to take temporary control of trust assets and distribute them to beneficiaries at the appointed time.
To this end, state law contains strict provisions concerning the rights and obligations of these parties. Under TX Prop. Code § 113.051, a trustee must always act in a way that serves only the interests of the trust and the beneficiaries. The trustee must also keep records of the steps that they take to fulfill this obligation. A trustee may be personally liable for any damage that lowers the value of the trust due to mismanagement or theft.
A trusts lawyer from Romano & Sumner in Rosenberg can further explain the role of trustees and help nominated people to fulfill their obligations under the law. Our legal professionals can also advise on holding a trustee accountable for misconduct.
Trusts can offer a fairly simple but effective way to transfer property from one party to another. This can occur upon a settlor’s death as a substitute for a will or as a means to provide long-term income to children or those with disabling conditions.
These documents are powerful, so it is essential to understand how they function and what role the trustee will play. A Rosenberg trusts lawyer can evaluate whether a trust is right for your objectives and draft documents to achieve those goals. Reach out to the skilled team at Romano & Sumner today to schedule a consultation.
Romano & Sumner, PLLC
