Different Types of Trusts
Manya Deva Natan is a California Bar Certified attorney with the law firm of SSS Legal & Consultancy Services located in Calabasas, CA. Her practice focuses on International Estates, Trusts and Estates, Asset Protection, Trust Administration, and more. Manya received her law degree from Stanford University, as well as a Master's in International Affairs from Columbia University. She has completed extensive course-work and training in the areas of mental, physical, and emotional health, including being a published author. She is the founder of two publishing-based companies related to health and wellness and has particular interest in the legal and financial components of health and their importance in integrated health. She has appeared multiple times on Good Morning America and is regularly contacted by national media outlets for commentary.
While all trusts share some similarities, there are many different types of trusts that you can use as part of your estate plan. For that reason, it is helpful to know what some of your alternatives are if you are considering getting a trust.
Trusts can be a bit confusing. Everyone knows the basics. Trusts are a legal entity managed by a trustee for the benefit of others. Beyond that, however, trusts can get murky as there are many different types of trusts that are sometimes confusing to non-experts.
To help people overcome trust confusion, the Wills, Trusts & Estates Prof Blog published a short list of different types of trusts in an article titled “Choosing A Trust.”
The list includes:
- Credit Shelter Trust – With this trust a spouse can leave everything to a surviving spouse in a will, but direct that everything be placed into the trust while maintaining the estate tax benefits.
- Clayton QTIP Trust – Similar to the more well-known QTIP trust, but if a QTIP election is not made, it acts like a credit shelter trust.
- Irrevocable Life Insurance Trust – These trusts are created to be the beneficiary of life insurance policies, which keeps the payout from those policies outside of the estate for tax purposes.
- Charitable Remainder Trusts – Directs that assets be paid to the beneficiaries for life with anything left over distributed to charity.