Reasons to designate a trust protector

On Behalf of | Aug 15, 2016 | Trusts

Nevada residents who are preparing an estate plan may want to create a revocable trust to avoid probate or to ensure some additional control over how their assets are distributed. A trust is administered by a trustee.

However, even people who have appointed a trustee that they have a great deal of faith in may be concerned about their wishes being interpreted correctly or what might happen if there is a dispute among beneficiaries. Well-intentioned people might interpret instructions differently. As a result, a person might also want to appoint a trust protector. This can be done via a trust protector provision or special co-trustee provision. This person will be called in if there are any disputes about the trust.

The powers of a trust protector can be as broad or as narrow as the owner of the trust wishes. For example, a trust protector’s only function might be to deal with any disputes regarding the trust. On the other hand, those powers could be expanded to allow the trust protector to make amendments to the trust if those amendments are in keeping with the original intent of the trust. An example might be a case in which a trust is designed to maximize certain tax benefits and the laws change so that the trust needs to be modified.

Whether choosing a trust protector, writing a simple will or preparing a more complex estate plan, a person might want to work with an attorney. Estate plans may require precise legal language to be valid. An attorney may also be able to make suggestions regarding the estate plan. For example, a person might think of a trust as something that is only useful for very wealthy people and not realize they can use a special needs trust to safeguard assets for a disabled loved one.