What is a testamentary trust and how does it work?

A testamentary trust is a trust created upon the death of an individual. It is a type of estate planning tool used to provide for the distribution of assets to beneficiaries upon the death of the individual. The individual, known as the grantor, designates a trustee to manage the trust and beneficiaries to receive trust assets. The grantor also establishes the trust terms, which can include provisions for a time frame for distributions to the beneficiaries, age requirements for beneficiaries to receive assets, and instructions for the trustee to manage assets. Trust assets can come from the grantors estate and can include cash, investments, and other assets. Upon the grantor’s death, the trust document is read and the assets are transferred to the trustee, who is responsible for managing the assets and distributing them according to the terms of the trust. Washington state law requires certain formalities to create a valid testamentary trust including a notarized signature, the inclusion of an identifying title, and the witnessing of the trust agreement. The trust must also be properly funded by transferring of assets to the trustee. A testamentary trust is a useful estate planning tool, allowing a grantor to provide for beneficiaries over long periods of time, while avoiding the cost and public nature of probate court.

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What is a testamentary trust and how does it work?

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