A trust is an agreement that can provide for the management and distribution of assets during life and/or after death. Assets owned by the creator of the trust are transferred over to the trust. Trustees are appointed by the trust’s creator to manage the assets according to the directions given in the trust agreement. A trust agreement designates who will use the trust assets during the life of the creator and who will inherit the assets owned by the trust at the death of the creator or at some other specified time.
Trusts created during the lifetime of the creator do not require court involvement in the form of probate because the trustees are given the legal authority to act when the trust document is executed. Testamentary trusts are trust agreements that are part of a Will and do require that the court appoint the Trustee. The Trustee, like the Executor, must value the assets, pay creditors, file required tax returns and see to the proper distribution of assets.