What is a testamentary trust?

A testamentary trust is a type of trust created in a will. It is established upon the death of the grantor, also referred to as the decedent or testator, and can be used to provide for certain beneficiaries named in the will. Under Illinois law, a testamentary trust can be used to accomplish a number of objectives, including protecting assets from creditors, avoiding probate, and providing for children and other dependents. The trust document is typically included in the will and outlines the details of how and when assets should be managed and distributed. Assets in the trust remain under the control of the trustee, who must follow the instructions outlined in the document. The trustee is also responsible for filing annual reports and other documents with the court, and must ensure the trust is managed according to Illinois law. The trustee has the authority to invest and reinvest the trust assets, pay creditors of the grantor, manage the trust, and distribute assets as specified in the document. Assets in a testamentary trust are transferred tax-free, and the trustee is responsible for reporting and paying any applicable taxes on trust income and capital gains. Testamentary trusts can be useful for providing for minor children or persons with special needs, to ensure assets are managed for their long-term benefit. It can also be used to provide for a spouse or partner after the death of the grantor. In Illinois, a testamentary trust can provide a measure of stability and protection and can be an important part of estate planning.

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What is a testamentary trust?

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