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25 Cards in this Set

  • Front
  • Back
Requirements for valid trust:
(1) Settlor
(2) Delivery of legal title to
(3) Property (res, corpus) to
(4) Trustee who holds title for a
(5) Beneficiary with
(6) Intent to create a trust for a
(7) Lawful purpose
(8) In writing AND
(9) Either acknowledged or signed by 2 witnesses
Who can be a trustee of a lifetime trust?
Pretty much anyone
Who can be trustee of a testamentary trust?
(a) people under 18
(b) incompetents
(c) convicted felons
(d) people incapable because of drunkenness, dishonesty, want of understanding, or improvidence
(e) non-resident aliens UNLESS
(1) related o the decedent AND
(2) NY resident serves as co-fiduciary
What happens if the trust fails to name a trustee?
NEVER invalidates the trust - the court can just appoint someobody
What happens if beneficiaries are not ascertainable?
Resulting trust for the residuary beneficiary
What if the trust is on behalf of "family" or "next of kin"?
That's ok - apply intestacy rules to see who it's for...
Does T have to intend to create an enforceable obligation in a trust?
YES - "precatory" language ain't good enough
Does the trustee have to actually DO stuff?
YEP - a "passive" trust is not a trust
What does it mean that the purpose must be lawful?
(a) can't call for commission of a crime
(b) can't call for destruction of property
(c) can't be against public policy
What kinds of things are against public policy regarding purposes of trust?
Restriction of marriage or promotion of divorce
BUT it's ok to
(a) condition upon spouse getting remarried
(b) restrict within religious or ethnic group
Revocable lifetime trust - discuss...
(a) Settlor cannot be the only beneficiary
(b) Settlor may retain power to terminate or revoke a trust
If a trust does not specify whether it's revocable or not, is it?
NO - it's irrevocable

*BUT if all appropriate parties consent, it may be revoked anywho
Can creditors get at a revocable lifetime trust?
YEP - the whole thing
What counts as an asset for estate tax purposes when dealig with a revocable lifetime trust?
The whole enchilada - if it's revocable OR the settlor retains interest income
Can you make a testamentary gift to an existing trust?
Yep, this is a POUR-OVER gift, as long as the trust was in existence before or executed concurrently with the will
Can you make life insurance proceeds payable to a trust?
Yes, by
(a) creating an unfunded trust and then naming trustee as beneficiary OR
(b) creating testamentary trust and naming "trustee in will" as beneficiary
Is ITF enough to create a Totten trust?
Does the beneficiary of a Totten trust have any interest during the depositor's lifetime?
Does the remainder of a Totten trust avoid probate?
YES, except to the extent that it's a T-Sub
How can the depositor revoke a Totten trust?
(a) withdraw all funds from the account
(b) express revocation
(c) by will
What are the requirements for an express revocation of a Totten trust?
(a) Writing - naming beneficiary and financial institution
(b) Notarized
(c) Delivered to the bank
What are the requirements for a revocation of a Totten trust by will?
Will must name:
(1) beneficiary and
(2) name of financial institution
Can creditors of a depositor reach a Totten trust account?
Yes, before and AFTER death of the depositor
Can you challenge a joint bank account as not having a right of survivorship?
Yes - must present clear and convincing evidence that survivorship was not intended and account was only opened for convenience
Who owns the cash money in a joint bank account?
Each person owns 1/2, regardless of who put money in
*except where it's created after marriage - T-Sub