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Formal Trust Agreement

1. Imagine that John and Lisa and their son Don. John and Lisa buy a house, contribute $US 200,000 to the purchase price of the house, and Don also contributes $200,000. First of all, it is said that Don owns 50% of the house. To allow his parents to obtain a mortgage and allow them to benefit from certain property tax exemptions, Don transfers his shares in the house to his parents. When his parents died, they had never returned Don`s interest in him. Once a court was aware of the whole story, it could donate half of the house. The court would decide that Dons` parents held the part for him in a “constructive” confidence. They have the title, but they considered it the final advantage of Dons. This is a classic confidence agreement, although the parties may never have indicated that they intended to create a position of trust. Trust Records: There are no specific legal requirements for data records that must be conducted by the Treuhand. Nevertheless, administrators should keep accurate records to demonstrate that they have done their job properly. It is recommended that these books contain records of all discretionary decisions.

The corresponding accounting documents for the trust should be kept in the usual manner and in accordance with ITA requirements. A fiduciary corporation provides an individual (the “Settlor”) with a mechanism to make property available to another person (the “agent”) for the benefit of a third party (the “beneficiary”), while maintaining some kind of control over the property. The property is owned and managed by the agent. The person (s) in favour of which the trust is made and which ultimately includes income and/or wealth. Recipients of a trust may be either “income beneficiaries” if they are entitled only to the income of the trust, or “capital beneficiaries” if they are entitled to the trust`s capital, or both. There are many reasons why someone would choose to establish a position of trust. This includes: 3. The trust must include the signature of the donor and the agent. Many states require that the signature be notarized or attested by two witnesses who would sign the document as witnesses.

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