A Trust Account is created when one person holds money or property for the benefit of another, usually under some type of written agreement called a “Declaration of trust” or “Trust Agreement”. The creator, called the “trustor” or “grantor”, transfers property to another person, called the “trustee”, who holds the property for the benefit of another person, “beneficiary”.

To open a trust you will need to bring your Trust Agreement which must contain: trustors, trustees, successor trustees, and beneficiaries. Depending on which type of trust that is set up, you will also need:

Living/Revocable Trust: Living Trusts are revocable (can be amended) by the grantor during his/her lifetime. During his/her lifetime the grantor is also the trustee and beneficiary. Upon the death of the grantor the successor trustee takes over as trustee and follows the grantor’s instructions that are set forth in the trust. These instructions can include distribution of property and payment of any expenses or taxes. Living Trust assets are subject to state and federal estate taxes. This type of trust is set up when you want to avoid probate or want protection for the privacy of your property and beneficiaries after you die. At least one grantor must qualify for membership and you will need the grantor’s social security number.

 Irrevocable Trust: Irrevocable Trusts cannot be changed or cancelled once it has been established without the consent of the beneficiary. Irrevocable trusts offer tax advantages that revocable trusts don't. With an Irrevocable Trust, the trustor no longer owns the assets, they are owned by the trust. If the trustor dies his/her estate will not be taxed. You will need to bring the tax identification number.

This information is for educational purposes only and is not intended to provide specific tax or legal advice. For answers to tax questions, please see your tax professional. For legal questions, consult an attorney.