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Basics of a sample living trust

Beneficiary


Once the trustors have passed, distribution of the estate can proceed. The trust should explicit instructions how distribution shall occur. First, all debts of the trustors must be repaid. After debts are repaid, the remainder is distributed to the beneficiaries.

Most trusts include an section to list personal items, such as jewelry, heirlooms, etc., to be given to specific people who may not be named elsewhere in the estate. After personal items are distributed and all other matters have been cared for, the estate can be distributed in percentages or specific amounts.

Basics of a sample living trust

Distribution


PAUL B. GREEN, one-third (1/3), LINDA B. GREEN, one-third (1/3) and JENYPHER B. GREEN, one-third (1/3).


To avoid the need to create amendments should beneficiaries pass, a thoroughly-written trust will have enough contingents to cover the foreseeable future. "Living issue" refers to a biological child or adopted child.

Basics of a sample living trust

Deceased Beneficiaries


In the event a beneficiary named above is not then living, the share of such deceased beneficiary shall be equally distributed to his or her then living issue per stirpes. In the event a beneficiary has no then living issue, the share of such deceased beneficiary shall be distributed one hundred percent (100%) to the survivor of them. In the event the beneficiaries above have no living issue and are all no longer living, the balance of the estate shall be distributed as follows: THE AMERICAN CANCER SOCIETY, one-hundred percent (100%).


To prevent young beneficiaries from spending an inheritance unwisely, distributions can be held in the trust until certain age, education or any other requirements are met. Distributions can also be spread over periods of time.

Basics of a sample living trust

Ages For Distribution


1. Distribution of Principal at Age Thirty (30). When each of the then living beneficiaries named above attains the age of thirty (30) years, the Trustee shall distribute one-half (1/2) of the principal of said beneficiary's share to said beneficiary.

2. Termination at Age Thirty-Five (35). When each of the then living beneficiaries named above attains the age of thirty-five (35) years, the Trustee shall distribute all of the remaining principal and undistributed income to such person, outright and free of trust.


Should a beneficiary have needs prior to a distribution, the successor trustee can approve partial or entire early distributions. This language is typically generic to allow the greatest flexibility since it is hard to predict future circumstances. This duty is a critical factor when choosing successor trustees.

Basics of a sample living trust

Early Distributions


If the Trustee deems the net income available hereunder not sufficient to provide for the reasonable health, support, maintenance and education of any beneficiary for whom a trust is then held, taking into consideration any other income and financial resources of such beneficiary, so far as known to the Trustee, it may, as often as it deems necessary, pay to or apply for the use and benefit of such beneficiary such part of the principal of the respective trust of such beneficiary, up to and including the whole thereof, as is necessary for the reasonable health, support, maintenance and education of such beneficiary.


To deter someone from contesting the estate, many trusts include clauses automatically disinheriting any person legally contesting the estate.

Basics of a sample living trust

No Contest Clause


In the event that any beneficiary under this trust shall, singly or in conjunction with any other person or persons, contest in any court the validity of this trust or of a deceased Co-Trustor's Last Will or shall seek to obtain an adjudication in any proceeding in any court that this trust or any of its provisions, or that such Will or any of its provisions, is void, or seek otherwise to void, nullify, or set aside this trust or any of its provisions, or such Will or any of its provisions, then the right of that person to take any interest given to him by this trust shall be determined as it would have been determined had the person predeceased the execution of this Trust Agreement. The Trustee is authorized to defend, at the expense of the trust estate, any contest or other attack of any nature on this trust or any of its provisions.


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