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Simple English definitions for legal terms
trust agreement
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A quick definition of trust agreement:
Term: Trust Agreement
Definition: A trust agreement is a legal document that outlines how assets will be managed and distributed to beneficiaries. It is similar to a declaration of trust, which is a statement of the creator's intention to create a trust. A trust agreement can be used to protect assets, provide for loved ones, and minimize taxes. It is important to have a trust agreement in place to ensure that your wishes are carried out after you pass away.
A more thorough explanation:
Definition: A trust agreement is a legal document that outlines the terms and conditions of a trust. It is also known as a declaration of trust.
Example: John creates a trust agreement that states his assets will be held in trust for his children until they reach the age of 25. The trust agreement also outlines who will be the trustee and how the assets will be managed.
Explanation: The example illustrates how a trust agreement is used to establish a trust and define its terms. In this case, John is the grantor of the trust and his children are the beneficiaries. The trust agreement specifies when the assets will be distributed and who will be responsible for managing them until that time.