A Trust is a legal entity that is able to hold the title to property on behalf of one or more people or legal entities.

  • The person who sets up the trust is called the Creator (or Grantor, Trustor, Donor, or Settlor).
  • The person or entity that controls the Trust and is responsible for managing the Trust assets is called the Trustee. (The Trustee can only use the assets and proceeds from the Trust property for the benefit of the people the Trust is set up to benefit, never for his or her own profit.)
  • Beneficiaries are those persons who are intended to benefit from the Trust.
  • The property that is transferred to a Trust becomes the Trust estate (or Trust corpus, Trust res, or Trust principal), and consists of all of the property, rights, and obligations that are transferred to the Trust.
  • The Trust agreement or declaration of Trust lays out the way that the Trust will be managed, including the purpose of the Trust, the identities and powers of the Trustees, the names of the Beneficiaries, how the Trust assets should be managed, and how they should be distributed to Beneficiaries.

Trusts are also revocable or irrevocable.

  • A Revocable Trust can be revoked and the Grantor can reclaim the Trust assets.
  • An Irrevocable Trust can not be revoked once it has been set up. The Grantor can arrange to be the Beneficiary of an irrevocable Trust during the Grantor’s lifetime, but he or she cannot take the trust assets back again.