In exercising these attributes, the trustee must prove himself worthy of the trust that the settlor
gave him, so that he will have to give to the property right, a use that is in accordance with the purpose for which he received the property.
If, after a thoughtful consideration of the foregoing, the settlor
or beneficiaries of an OAPT desire to repatriate their offshore trust, there are three specific methods of domestication.
11) Offshore trusts provide two primary benefits: (1) strong spendthrift protection; and (2) the possibility for a settlor
to control and/or benefit from the property held in the trust.
Importantly, any fees and expenses for legal services relating to settlor
decisions should not be paid by the plan.
This Article exposes the conflicting ways that courts and legislatures have been grappling with these clauses that pit settlor
intent, not against a general distaste for forfeiture, but instead against fiduciary accountability, and it proposes solutions both for those who are planning trusts and for those who are interpreting them.
Applying state law to the facts, the IRS found that the affidavits from the settlor
, the drafting attorney, the accountant, the financial planner, and the second attorney, together with contemporaneous correspondence, memoranda, and emails, provided clear and convincing evidence that the revocable provision in the Children's Trust did not conform to the settlor
's intent and was due to a scrivener's error.
The plaintiff argued that the trust settlor
had created the trusts primarily for estate tax purposes--so that he could pass the property to his wife and take advantage of the marital deduction, while ultimately leaving the property to his daughter.
With a Discretionary Trust, the settlor
makes a gift into trust which the trustees hold for a wide class of potential beneficiaries.
In these instances, the less well-known private trust company (PTC) concept provides an interesting alternative, in which the settlor
is able to keep a higher level of control, while still retaining many of the benefits of a trust.
The reservation by the settlor
of certain rights and powers, and the fact that the trustee may himself have rights as a beneficiary, are not necessarily inconsistent with the existence of a trust.
Trust assets would, for example, be includable in the gross estate of the settlor
for estate tax purposes.
Under these circumstances, a party with a claim against the children would be unable to reach the trust assets under the theory that the settlor
(parent) is the owner of the property and can do with it as he or she wishes.