What is a Totten Trust?
A Totten trust is a common testamentary substitute. A testamentary substitute is an instrument that determines the disposition of a decedent’s property on its own, without the need for a will. A Totten Trust (also known as a “Payable on Death Account) is created during the lifetime of a decedent. The decedent names a beneficiary to the account, which is payable upon the death of the decedent.
Why use a Totten Trust?
One benefit is that in using a Totten Trust, a decedent avoids the need for the assets in its corpus to go through probate. The corpus is available upon the death of the decedent.
Are there any other types of trusts?
Yes, trusts come in many different forms. Two such trusts are trusts for special needs beneficiaries that are enrolled in government benefit programs, and minority trusts, for children under the age of 18.
Note: Other types of trusts exist, this article is meant to provide a brief overview of some options in estate planning.
Disclaimer: This is meant as a brief overview of the law in New York, and is not intended to be interpreted as legal advice. Nothing herein is to be construed as legal advice. If you have any questions, please feel free to call Quinn & Tyrrell at (516) 221-5100.