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Continue reading → The post How to Protect Trust Assets From a Beneficiary's Divorce appeared first on SmartAsset Blog. Trusts can be a useful estate planning tool for passing on wealth to heirs ...
In trust law, an asset-protection trust is any form of trust which provides for funds to be held on a discretionary basis. Such trusts are set up in an attempt to avoid or mitigate the effects of taxation, divorce and bankruptcy on the beneficiary. Such trusts are therefore frequently proscribed or limited in their effects by governments and ...
The term "grantor trust" also has a special meaning in tax law. A grantor trust is defined under the Internal Revenue Code as one in which the federal income tax consequences of the trust's investment activities are entirely the responsibility of the grantor or another individual who has unfettered power to take out all the assets. [20]
Similarly, transfer of the borrower's home to a spouse as part of a divorce or dissolution of marriage generally does not trigger a due-on-sale clause. There are other exemptions in the law as well. Use trusts also facilitates transfers of property to heirs and minors .
Personal trust law developed in England at the time of the Crusades, during the 12th and 13th centuries. In medieval English trust law, the settlor was known as the feoffor to uses, while the trustee was known as the feoffee to uses, and the beneficiary was known as the cestui que use, or cestui que trust .
An offshore trust is a conventional trust that is formed under the laws of an offshore jurisdiction.. Generally offshore trusts are similar in nature and effect to their onshore counterparts; they involve a settlor transferring (or 'settling') assets (the 'trust property') on the trustees to manage for the benefit of a person, class or persons (the 'beneficiaries') or, occasionally, an ...
The increased use of trusts in estate planning during the latter half of the 20th century highlighted inconsistencies in how trust law was governed across the United States. In 1993, recognizing the need for a more uniform approach, the Uniform Law Commission (ULC) appointed a study committee chaired by Justice Maurice Hartnett of the Delaware ...
The trust beneficiary would file a tax return as if they earned the trust income. The trust beneficiary would use their personal exemptions and tax credits to reduce their taxable income. It can also be used to shield assets from matrimonial division in case of divorce of the beneficiary. In most cases, the trust assets are immune from claims ...