Define: Express Trust

An express trust is a legal arrangement where a person (the settlor) transfers assets to another person (the trustee) to hold and manage for the benefit of a third party (the beneficiary) according to specific instructions outlined in a trust document.

An express trust is created by the settlor’s clear and unequivocal intention to create a trust, the identification of the trustee and beneficiaries, and the transfer of assets to the trustee.

No, an express trust must be created in writing to be valid. It requires a trust document that clearly outlines the terms and conditions of the trust.

The trustee has a fiduciary duty to act in the best interests of the beneficiaries, manage the trust assets prudently, and follow the instructions outlined in the trust document. They must also provide regular accountings and keep the beneficiaries informed about the trust’s administration.

Yes, a settlor can also serve as a trustee in an express trust. However, it is important to ensure that the trust is not considered a sham or a mere alter ego of the settlor to avoid potential legal issues.

In most cases, an express trust can be modified or revoked if the trust document allows for it. However, certain irrevocable trusts may have restrictions on modification or revocation.

If a trustee breaches their duties, they can be held personally liable for any resulting damages. The beneficiaries may also have the right to remove the trustee and appoint a new one.

Yes, an express trust can be challenged in court if there are valid grounds, such as lack of capacity or undue influence during its creation, fraud, or if the trust’s terms are ambiguous or contrary to public policy.

Yes, express trusts are subject to taxation. The trust itself may be required to file tax returns and pay taxes on any income generated by the trust assets. Additionally, beneficiaries may be subject to tax on distributions received from the trust.

Yes, express trusts are commonly used in estate planning to ensure the orderly transfer of assets, minimize estate taxes, provide for minor or incapacitated beneficiaries, and protect assets from creditors or other potential risks.