How To Create A Pure Trust (DIY)

Contract Trust- irrevocable

A pure trust is a type of trust that is created for the sole purpose of holding and protecting assets. It is a legal arrangement in which a person, known as the settlor, transfers ownership of their assets to a trustee, who holds and manages the assets for the benefit of the trust's beneficiaries.

• Pure trusts are irrevocable, which means that they cannot be amended or terminated by the settlor once they have been created.

• Pure trusts do not have any tax implications for the settlor or the beneficiaries. The trust's assets are not taxed as the property of the settlor or the beneficiaries, and any income or gains generated by the trust's assets are taxed at the trust's rate.

• Pure trusts are private arrangements, and their terms and provisions are not generally subject to public scrutiny.

• Pure trusts are not subject to the same regulatory oversight as other types of trusts, such as charitable trusts or trusts for the benefit of minors.

• Asset protection: A pure trust can be used to hold assets that may be at risk of being seized or attached by creditors or other claimants. By transferring ownership of the assets to the trust, the settlor can protect them from being taken by third parties.

• Tax benefits: As mentioned above, pure trusts do not have any tax implications for the settlor or the beneficiaries. This can be particularly beneficial for high net worth individuals or families who are looking to minimize their tax burden. • Privacy: Pure trusts are private arrangements, which can be attractive to individuals who want to keep their financial affairs private.

• Flexibility: Pure trusts can be customized to meet the specific needs and goals of the settlor and the beneficiaries. The settlor can specify how the trust's assets are to be managed and used, and can designate specific beneficiaries to receive the trust's benefits.