A trust is a legal document that allows you to transfer your  property to a loved one, spouse or child with special needs. As the grantor or settlor, you appoint a trustee who has legal control of the trust and ensures that the needs of the beneficiaries are met. 

Trusts are created for different purposes. For some, they create a trust for tax purposes. A trust may work as a means of avoiding tax because it reduces your income tax as the grantor.

When the grantor dies, having a trust automatically reduces federal estate tax and protects the assets in the trust from the scrutiny of the probate court. A trust can be used to transfer properties to a beneficiary and remain in place for years. At the same time, it can be used to meet the needs of the beneficiaries and then get terminated.

Why Does a Trust End?

A trust ends depending on the type of trust and the terms on which the trust was created. For instance, a trust can end when it has fulfilled its purpose of taking care of a beneficiary over some time. 

Also, a trust can end when the assets in the trust have been exhausted. This could be a result of mismanagement by the trustees. And sometimes, it could be a result of the bad financial market at the time. For instance, if the estate is invested in the stock market and it crashes, it’s not the fault of the trustee. The assets in a trust don’t have special protection from the market conditions and the economy.

A trust can also come to an end when the assets in it are destroyed. For instance, if an apartment, store or even jewellery held in trust for loved ones is destroyed, then the trust automatically comes to an end.

Other instances in which a trust may be terminated include:

• If the creator or the settlor wasn’t in the right state of mind when the trust was created. This makes the trust invalid and so must be terminated.
• If the settlor created the trust under duress, undue influence, mistake or fraud. 
• If the trust was made for an illegal purpose like tax fraud.
• If the trustee is capable of flouting the rules.

What roles do trust attorneys play in trust termination?

Trust attorneys play a role in trust termination but this right can only be conferred on them by the settlor. The settlor of a trust is the only person capable of terminating a trust, however there are others who could terminate a trust too, including:

Beneficiaries who are not in agreement with the trust. However, they can only proceed with this if there’s an agreement on the part of all the beneficiaries.

Also, people that can get negatively affected by the trust can terminate a trust.

However, there has to be some strong intention which is recognized by the court before the termination of the trust and this is where a trust attorney comes in. Trust attorneys help in creating an appeal for the termination of the trust that will be accepted by the court. A trust can be terminated if the reason is backed by strong intentions like impracticality, illegality or the trust expired.

Conclusion 

There are different reasons why a trust can be terminated. But the first step to terminating a trust is to hire the best trust attorney, and it’s a plus if they helped with creating the trust. 

Your trust attorney can provide the best advice on how to handle the termination of a trust, depending on your reason for termination. They can also represent you in court and remind you of your legal rights if you ever have to appear in court.