Who’s Going to Get It: Do You Really Know the Beneficiaries of Your Dynasty Trust?

Many estate plans now contain irrevocable dynasty trusts. These trusts are designed to benefit the spouse for their lifetime and then benefit several more generations. Because they are created to span multiple decades, you need to be sure you clearly list who is included as the trust moves from generation to generation.

Who Are Your Descendants?

In the past, your descents were defined as your blood relatives. Today, the definition a family has changed and includes more than just blood heirs.

• Adopted beneficiaries – Your trust needs to be specific regarding descendants. Should an adopted child, grandchild or great-grandchild be included? Should an adopted adult be included? Should a naturally born child given up for adoption be counted as a descendant? These things need to be considered when defining “descendant” in your beneficiary trust.
• Stepchildren – Your trust needs to include or exclude stepchildren in the definition of descendants. They may be your stepchildren or your child’s, grandchild’s or great grandchild’s stepchildren. You may want to include some but exclude others. Some stepchildren may never be legally adopted but still treated as one of their own. Do you include these? Be sure your trust is clear and you communicate whether you want future stepchildren to be beneficiaries.
• Beneficiaries conceived using “assisted reproductive technology” – Your trust should also include or exclude in the definition of descendant any children conceived using “assisted reproductive technology.” What if a child, grandchild or great grandchild is conceived using artificial insemination, a surrogate mother, or an anonymous sperm or egg donor? Do you want them considered descendants and receive benefits from your estate? Be sure to also define whether to include or exclude these situations in your dynasty trust wording.

Carefully Defining Your Trust Beneficiaries Will Keep Your Heirs Out of Court

Defining your “descendants” twenty or even fifty years into the future will help the trust to smoothly pass from one generation to the next. Having the class of beneficiaries defined clearly between generations will allow a smooth transition to take place over multiple generations and keep your future heirs and trustees out of court.

Call our office if you have any questions or need help creating a dynasty trust. We are experienced in dealing with the legal documentation and can help you clearly lay out your wishes for the future of your estate.


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