Types of Trusts 

Express trusts may take a number of different forms. The most common categories of express trusts are living trusts, testamentary trusts, revocable and irrevocable trusts, fixed trusts, and discretionary trusts. 

  • Living Trusts. A living trust, or inter vivos trust, is created for the benefit of another during the settlor's life.

  • Testamentary Trusts. Testamentary trusts are created by a settlor's will. A settlor's property is therefore transferred into the trust when the settlor dies.

  • Revocable Trusts. A revocable trust allows the settlor to retain sole control of the trust. While the settlor does not receive any tax benefits from a revocable trust, the settlor can withdraw funds from the trust, or alter or cancel the trust at any time.

  • Irrevocable Trusts. The trustee of an irrevocable trust is given sole control over the trust property. Typically, the trust will not come to an end until the trust purpose is fulfilled. The trust may be altered or revoked before this time only with the consent of the trustee and all beneficiaries.

  • Fixed Trusts. Beneficiaries to a fixed trust receive trust property on a specific schedule set forth by the settlor. The trustee of a fixed trust has little or no discretion to distribute trust property.

  • Discretionary Trusts. A discretionary trust gives the trustee the power to choose how and when, if at all, to distribute trust property to beneficiaries. A discretionary trust may provide significant tax benefits to beneficiaries, since no beneficiary has an interest in trust assets until they are distributed.

Other Types of Trusts 

While express trusts arise from the explicit instructions of a settlor, other types of trusts, such as constructive trusts and resulting trusts, are imposed by courts as equitable remedies that prevent unjust enrichment. 

  • Constructive Trusts. A constructive trust is imposed when a wrongdoer acquires legal title to property that rightfully belongs to another. Under the constructive trust, the wrongdoer becomes the trustee of the property, with a duty to return the property to the true owner.

  • Resulting Trusts. A resulting trust arises when an express trust fails. The person who currently holds the property becomes a trustee and is obligated to return the trust property to the settlor.

Irrevocable trust

revocable trust

special need trust

Probate avoidance trust