Delaware Crummey Trust Agreement for Benefit of Child with Parents as Trustors

• Category: Trusts - Bypass
• State: Multi-State
• Control #: US-0641BG
• Format: Word; Rich Text

Description

In a Crummey trust, parents place gift money into a trust and give their child (or other recipient) the right to withdraw the amount of each gift for up to 30 days after each gift is made. Since the withdrawal right begins immediately after the gift is ma The Delaware Crummy Trust Agreement for the Benefit of Child with Parents as Trustees is a legal document that establishes a unique type of trust arrangement in the state of Delaware. It provides a mechanism for parents (as trustees) to transfer assets or property into a trust for the benefit of their child. This trust is often used as an estate planning tool to ensure that the child receives financial support and management of assets even after the parents' demise. The Delaware Crummy Trust Agreement operates under specific guidelines, referencing the Crummy power which allows the beneficiaries to withdraw and receive a certain portion of the contribution made to the trust within a limited period, typically 30 days. This provision helps qualify the trust contributions for certain gift tax exclusions. There are several types of Delaware Crummy Trust Agreements available, each serving specific purposes: 1. Irrevocable Delaware Crummy Trust: This trust arrangement, once created, cannot be altered or revoked by the trustees (parents). It provides a legally binding commitment to preserving assets for the child's benefit and offers potential tax advantages. 2. Revocable Delaware Crummy Trust: Unlike the irrevocable version, this trust allows the trustees to modify or revoke the trust terms at any time during their lifetime. However, it becomes irrevocable upon the trustees' death, ensuring the intended benefit for the child. 3. Testamentary Delaware Crummy Trust: Created through a will, this trust activates upon the trustees' death and provides for the child's financial needs as outlined in the trust document. This type of trust may bypass probate, offering a smoother transition of assets. The Delaware Crummy Trust Agreement can include specific provisions and preferences stipulated by the trustees, such as limitations on the child's access to funds until reaching a certain age or achieving specific milestones. Furthermore, provisions for the appointment of a trustee to manage the trust assets and make distributions on behalf of the child can be incorporated into the agreement. Overall, the Delaware Crummy Trust Agreement for the Benefit of Child with Parents as Trustees is an estate planning tool that enables parents to safeguard their assets for the well-being of their child. It incorporates the Crummy power to optimize gift tax treatment and offers flexibility through various types of trusts.

The Delaware Crummy Trust Agreement for the Benefit of Child with Parents as Trustees is a legal document that establishes a unique type of trust arrangement in the state of Delaware. It provides a mechanism for parents (as trustees) to transfer assets or property into a trust for the benefit of their child. This trust is often used as an estate planning tool to ensure that the child receives financial support and management of assets even after the parents' demise. The Delaware Crummy Trust Agreement operates under specific guidelines, referencing the Crummy power which allows the beneficiaries to withdraw and receive a certain portion of the contribution made to the trust within a limited period, typically 30 days. This provision helps qualify the trust contributions for certain gift tax exclusions. There are several types of Delaware Crummy Trust Agreements available, each serving specific purposes: 1. Irrevocable Delaware Crummy Trust: This trust arrangement, once created, cannot be altered or revoked by the trustees (parents). It provides a legally binding commitment to preserving assets for the child's benefit and offers potential tax advantages. 2. Revocable Delaware Crummy Trust: Unlike the irrevocable version, this trust allows the trustees to modify or revoke the trust terms at any time during their lifetime. However, it becomes irrevocable upon the trustees' death, ensuring the intended benefit for the child. 3. Testamentary Delaware Crummy Trust: Created through a will, this trust activates upon the trustees' death and provides for the child's financial needs as outlined in the trust document. This type of trust may bypass probate, offering a smoother transition of assets. The Delaware Crummy Trust Agreement can include specific provisions and preferences stipulated by the trustees, such as limitations on the child's access to funds until reaching a certain age or achieving specific milestones. Furthermore, provisions for the appointment of a trustee to manage the trust assets and make distributions on behalf of the child can be incorporated into the agreement. Overall, the Delaware Crummy Trust Agreement for the Benefit of Child with Parents as Trustees is an estate planning tool that enables parents to safeguard their assets for the well-being of their child. It incorporates the Crummy power to optimize gift tax treatment and offers flexibility through various types of trusts.