The Different Types of Trusts in Texas

 Posted on January 05,2024 in Estate Planning

A trust is essential to ensuring your loved ones are well taken care of long after you have passed on. When thinking about establishing a trust in Texas, one must first understand the types of trusts that are available to them. You will also want to understand all of the responsibilities and rights as the creator of the trust, or grantor, that each type provides. An experienced Denton County, TX estate attorney can provide all of the information you need and more regarding trusts, wills, and all other aspects of estate planning.

Revocable and Irrevocable Living Trusts

Establishing a revocable living trust will allow the grantor access to his or her assets while they are still alive. In the event of the grantor’s death, the assets will pass over to the beneficiary and not require them to go through the probate process. A revocable trust can be dissolved if the grantor chooses to do so. This makes it different from that of an irrevocable trust which prohibits the grantor from dissolving the trust.

Testamentary Trusts

A testamentary trust is created through your will and does not activate until your death. This means that none of your assets can transfer over to the beneficiary until you are no longer a part of the land of the living. A testamentary trust will ensure the beneficiary receives the assets granted unto them. These trusts, like most trusts, can have multiple beneficiaries with their asset distribution specified. Texas testamentary trusts can last for an indefinite amount of years which the grantor can specify. The major difference with testamentary trusts in comparison to other trusts is that beneficiaries cannot avoid the probate process.

Special/Supplemental Needs Trusts

Meant specifically for disabled beneficiaries, special needs, or supplemental needs trusts enable the grantor to establish and maintain consistent provisions for a disabled family member after death. Doing so ensures their death does not disrupt the necessary care and benefits the disabled family member requires such as Supplemental Security Income (SSI).

Totten Trusts

A Totten trust is more or less a bank account that is set up for a beneficiary to receive all the money placed in it after the death of the account creator. Everything in the account goes directly to the beneficiary and allows them to avoid probate. For all other intents and purposes, a Totten trust acts as a normal bank account where the account creator can add or withdraw funds as they see fit or close the account altogether.

Contact a Denton County, TX Estate Planning Attorney

As you can see, there are multiple types of trusts available to anyone thinking about establishing one in Texas. For more in-depth guidance and advice you should reach out to an experienced Flower Mound, TX estate planning lawyer like Stephen Colbert. The Colbert Law Group PLLC can point you in the right direction and provide answers to any questions you may have concerning your estate. Contact the firm at 972-724-3338 to set up an appointment.