What is a trust?

A trust is an instrument used to manage and control assets for the benefit of another individual or entity. Trusts are created by the trustor, or the person who transfers assets into the trust. In Pennsylvania, trusts are governed by the Uniform Trust Code (UTC). In a trust, assets are held in the name of the trustee for the benefit of the trust’s beneficiaries. The beneficiary of a trust is the person or entity who will benefit from the trust. The trustor will appoint the trustee who is responsible for managing the trust assets according to the trustor’s instructions. The trustee of a trust is responsible for investing and managing the trust’s assets. This includes making investments to increase the trust’s assets, managing taxes, and making distributions to the beneficiaries. The trustee will also need to file regular reports to the trustor and the beneficiaries, detailing any income, gains, or losses from the trust. Trusts can also be used to minimize the amount of taxes a beneficiary has to pay. This includes the ability to shelter trust assets from inheritance tax. Trusts can also be used to protect assets from creditors. Trusts can be used for a variety of purposes, from estate planning to charitable giving. Depending on the trust’s purpose, trusts can last for a predetermined period of time, or be revocable or irrevocable. Trusts can also be used to create a will or to provide for a spouse or family member after the trustor passes away.

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