What are the trust funding requirements?
Trust funding requirements refer to the laws in place that govern how trust assets are to be managed and controlled. In West Virginia, trust funding requirements mandate that the trustee must first identify and collect all trust assets, then prudently manage and invest the assets by diversifying the investments, fully disclosing the purpose of the trust, and carrying out the terms of the trust agreement. The trust must then be managed in accordance with the prudent investor rule which requires that the trustee act in accordance with the standard of care that would be employed by a reasonable person of similar characteristics and experience. The trustee must ensure that trust funds are maintained in a separate account and must obtain an annual trust return from a financial institution. Further, the trustee must furnish an annual accounting to the beneficiaries that reports all trust transactions. The trustee must also make sure that all trust assets are insured and must segregate all trust assets from their own assets. Furthermore, the trustee must avoid self-dealing and conflicts of interests. Finally, the trustee must also obtain the advice of a qualified investment advisor to ensure that all of these requirements are properly met.
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