What is a discretionary trust?

A discretionary trust is an arrangement set up to take control of assets and manage them for the benefit of another person. A discretionary trust is established when the person setting up the trust (the settlor) transfers assets into the trust for a beneficiary. The trust allows the settlor to appoint trustees to manage the trust assets. The trustees have the discretion to decide when and how much of the trust assets can be distributed to the beneficiary. This discretion allows the trustees to decide when the beneficiary receives a benefit and make decisions based on changing circumstances. The trust also allows the trustees to manage assets for the future benefit of the beneficiary, such as investments and other investments. In Kansas, discretionary trusts are governed by state law. Trustees must follow the laws of the state and must act according to the terms of the trust. Trustees must also comply with other laws and fiduciary duties, such as managing assets for the benefit of the beneficiary and providing regular reports. The trust is also subject to tax laws in Kansas, and the settlor may be able to take advantage of certain tax benefits. Discretionary trusts can be a great tool for managing and protecting assets for the benefit of another person, but they must be created and managed properly in order to be successful. The settlor should work with a trust attorney to make sure they understand all the legal requirements, and that the trust will be structured to meet their objectives.

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