What is a testamentary trust and how does it work?

A testamentary trust is a type of trust created through a will that is legally established after an estate owner passes away. This type of trust is generally used to provide for relatives who are minors or have special needs, or to protect assets from being forced into probate court. It can also be used to minimize estate taxes and protect assets from creditors. An estate owner’s will typically names a trustee, who is typically a family member or a close friend. This person oversees the trust and must follow the instructions of the estate owner and avoid conflict of interest. The trust is funded with assets from the estate, and the trustee typically has the authority to invest and manage these assets. In Kansas, testamentary trusts are regulated by the state’s Trusts and Estates statute. Generally, these trusts must not last for more than 21 years, unless the trust is specifically written to extend beyond that period. Kansas law also outlines detailed provisions for the management of the trust, requiring the trustee to act responsibly and manage the trust prudently. In short, a testamentary trust is a type of trust created from the assets of an estate owner’s will. The trust is managed by a trustee, who is required to abide by state law and follow the instructions of the estate owner. The trust can provide for minors and special needs relatives, minimize taxes, and protect assets from probate court and creditors.

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What is a testamentary trust and how does it work?

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