Understanding the Testamentary Trust

Charleston Estate Planning | Testamentary TrustAlthough simple wills are an essential estate planning device for the construction of the Last Will & Testament, a testamentary trust can provide some useful provisions in many cases. A testamentary trust is legally understood as a fiduciary relationship created through explicit guidelines in a deceased person’s will. Testamentary trusts are most useful when a grantor wants to leave some or all of their assets to a beneficiary, but only until a specified time after their passing.

Some particularly salient uses of testamentary trusts might be:

  • If you wish to provide extended care for a spouse or children over an extended period of time rather than through a lump sum
  • If you wish to allocate money to children or grandchildren only once they reached adulthood
  • If you wish to leave behind a flow of contributions to a non-profit organization via a charitable trust
  • If you wish to provide extended care for a loved one with special needs through a special needs trust
A testamentary trust is an extremely useful legal device for anyone constructing a last will and testament who wishes to leave behind property or assets over an extended period of time or after a specified time.
While testamentary trusts might be most often employed for their estate tax reductions and other specific tax advantages, another important reason to construct a testamentary trust would be for the preservation of appreciating assets. Consider in-demand real estate properties, precious metals, collectibles or valuable commodities and other assets which may gain value over time. A testamentary trust allows grantors to secure these appreciating assets under the ownership of loved ones while guaranteeing that these assets may accrue value even after their passing. Our Charleston estate planning attorneys can provide legal counsel for individuals, professionals and families in the structuring in the last will and testament and the incorporation of testamentary trusts with the simple will.