What Is a Trust Account?
Trust accounts take varying forms, depending upon their function and the type of trust that is placed in them. In essence, a trust account is used to hold liquid assets that are included in a trust. If you are in need of opening or accessing a trust account, a College Station trust lawyer can help.
Trusts and Probate
There are many types of trusts to choose from if an individual wishes to create one. While they serve different purposes, generally they allow assets placed in them to avoid probate. This is good news for anyone who wants beneficiaries to have access to funds right away after his death, as probate can be very time-consuming and costly. A probate on a complex estate can even take years.
Just as there are many types of trusts, one particular trust may have two separate accounts. One of these would be where assets are kept and draw interest, like a savings account. Another could be a checking account used by the trustee to distribute assets in accordance with the instructions. It is even possible to take a bank account and place it into the trust. This is especially beneficial if the account is one that draws a high yield, and/or has assets held within that must remain there for a period of time to avoid early withdrawal penalties.
Holding a Bank Account in Trust
A bank account that is placed in a trust can be any of a variety of different types. Among these are certificates of deposit, brokerage accounts, and checking accounts. Placing an account into the trust serves a number of potential purposes, amongst which are avoidance of creditors, keeping the account from probate, and for the benefit of the beneficiaries.
It is very important to keep in mind that, when you create a trust, the assets you place inside it are, for all intents and purposes, no longer yours. This is great for avoidance of tax, but when you place a bank account in a trust you are thereby relinquishing ownership of its assets. This should not be a problem if the assets are meant to be left to beneficiaries after you die.
If You Need Assistance Creating a Trust or Trust Account
If you have questions about what sort of trust is right for you, how to create one, or how to place it in a bank account, a Bryan probate lawyer can help. Call Peterson Law Group today to arrange a meeting at 979-703-7014 or 936-337-4681.