A trust is a legal agreement that allows a grantor to set aside money for one or more recipients, known as beneficiaries. A grantor may list one or more people as primary beneficiaries, who each have equal claim to their portion of the money, and secondary beneficiaries, who are in line to receive the funds if all of the primary beneficiaries are deceased. A trustee is the person responsible for managing the trust and the property within the trust. The beneficiaries' rights to the bank statements of trust accounts depend on state laws and the type of trust.
In most trusts that have a clearly defined trustee and beneficiaries, the trustee is responsible to the beneficiaries for the funds in the trust. The trustee must provide regular reports to the beneficiaries regarding the state of the trust, any investments made on behalf of the trust and, if allowed by state law, the bank statements of the trust. If the trustee fails to uphold this commitment, the beneficiaries may petition the court to have the trustee replaced.
Accessing Trust Terms
Depending on the laws of the state in which the trust was written, the beneficiaries may be able to request a copy of the trust document, whereas in other states, they do not have that legal right. In states where the beneficiaries do not have that right, the trustee may legally provide just enough information to show beneficiaries that their assets are being protected by the trustee. The trustee has the option in those states to determine how much information he wishes to provide to each beneficiary.
Banks in some states offer a Totten trust, a special type of account that allows account funds to be passed to the named beneficiaries when the account holder dies. A Totten trust allows the account holder to pass funds to beneficiaries without going through probate. Totten trusts remain the property of the account holder while he is still alive, so beneficiaries do not have any rights to access the account, including bank statements, until the account holder dies.
Bank Account Beneficiary Designations
Banks may also offer accounts that are payable on death, or POD, to one or more listed beneficiaries when the account holder dies. As with a Totten trust, beneficiaries have no legal right to access the account in any form, including bank statements, until the account holder's death. The account holder may change the beneficiaries at any time on the account.
- Probate Estate Planner: Testamentary Trust
- Fidelity: What Is a Trust?
- Nolo: Advice to Trustees -- Get Along With Beneficiaries
- Estate Planners: What Is a Totten Trust?
- Banking Questions: In Trust for Accounts
- Nolo: Payable-on-Death Accounts -- The Basics
- Ford Bergner, LLP: Probate
- The People's Law Library of Maryland: Personal Bank Accounts
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