Trust Accounts

A legal arrangement through which funds or assets are held by a trustee or third party for the benefit of another party also known as the beneficiary is called a tust account. The may be an An individual or a group may qualify as the beneficiary. A ‘grantor’ or ‘settlor’ is the creator of the trust. 

A few typical features of a trust account include:

• Asset ownership must be transferred to the trust and the power of the trust is nil until this ownership changes. In legal jargon, this is referred to as “funding the trust."
• Only a mentally competent adult qualifies as the trustee and can be whomever the grantor trusts provided they have accepted the responsibility of handling matters related to the trust account.
• The trustee has the authority to make amendments to the account, subject of course to the terms and conditions of the original agreement.
• Responsibility for annual tax returns falls on the trustee. 
• All distributions to the beneficiary including related expenses must be paid from the trust account.