Trusts are an excellent alternative to a Will in planning for the distribution of your belongings and property after you pass and to give certain powers to someone you trust during your lifetime. For legal purposes, the greatest advantage to a trust is that it becomes effective during your lifetime and does not need to go before a Judge to continue after you pass. Remember, a probate action must be filed so that a Court can determine the Will meets certain legal requirements in order to be effective. No legal action needs to be taken to determine the validity of a trust. However, legal action may be taken to determine the trust to be invalid.
A trust needs three basic things in order to be valid. The first is a Trustor (a person who creates the trust), a corpus (belongings, personal property, real property and similar items) and a Trustee (a person designated by the Trustor to handle the trust. Generally speaking, the Trustor usually designates themselves as their Trustee. However, it can be anybody.
Think of a trust as a box you build. Once it’s created, it holds and protects everything you put in the box. This can be real property, cars, bank accounts, investment accounts, and similar items. As long as these items are put in a trust, the trust will continue to own all of the items you put in the trust’s name. You will be the trustee of the trust that owns these items as long as you live or until you are no longer able to serve.
Those are the basics of a trust. From there, a person can use the trust to do several things. They can designate who they want to get their property after their death and then end the trust. A person can give money or property to people you designate during their lifetime or until they reach a certain age. A trust can be used for a nearly unlimited number of reasons, depending upon what the person creating the trust wants to do.
Decanting Trusts is the act of distributing assets from an old trust to a new one with more favorable terms for the beneficiaries. Until recently, this was not allowed under Oklahoma law and is a recent development though it has been the law in many other states.