tag:blogger.com,1999:blog-788849002025834990.post5754398126114468846..comments2023-10-28T10:25:59.851-04:00Comments on Your Freedoms and the Law: I am the Trustee of a Trust. Can the Bankruptcy Trustee Take the Trust Assets?Kelsey & Trask, P.C.http://www.blogger.com/profile/05241677623102829217noreply@blogger.comBlogger10125tag:blogger.com,1999:blog-788849002025834990.post-34621085683387440932014-09-28T11:13:10.711-04:002014-09-28T11:13:10.711-04:00I am hesitant to provide any comment on the trust ...I am hesitant to provide any comment on the trust risk itself because trust terms are often misunderstood or misrepresented. I suggest bringing the actual trust document to your brother's bankruptcy counsel to review and tell you whether a bankruptcy will affect the trust at all. In addition, if the grantor has reserved the right to change trustees then it may be possible (after receiving the advice of counsel) to remove the brother as trustee.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-18559141865049092882014-09-26T00:25:03.803-04:002014-09-26T00:25:03.803-04:00I have a revocable trust for my children who are u...I have a revocable trust for my children who are under 21 at this moment. When they turn 21 they will become co-trustees until my death. I am the sole grantor and my wife, and my brother (in case something happened to me and my wife at the same time) are co-trustees and NOT beneficiaries. My brother has experienced financial reversals and is contemplating bankruptcy. I am going to promptly remove him from the trust, is there any danger to the trust or it's assets?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-3031314474434671392013-02-06T10:26:47.325-05:002013-02-06T10:26:47.325-05:00Anonymous,
Thank you for your question. Unfortuna...Anonymous,<br /><br />Thank you for your question. Unfortunately, there are a lot more details that we would need to know to answer your question. Whether or not a bankruptcy trustee or creditor can force the sale of trust assets depends on very specific details about how the trust is designed and whether or not there is any other way to provide fair value to the debtor's creditors for a non-exempt asset. For example, it may be possible for someone to buy out the nephew's share rather than sell the land, so that his buy-out funds could then satisfy the creditors. To explore all of your options, I suggest that you and your husband, the trustee, consult with an attorney familiar with bankruptcy in your area.Kelsey & Trask, P.C.https://www.blogger.com/profile/05241677623102829217noreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-26655157831161828862013-02-05T20:52:45.485-05:002013-02-05T20:52:45.485-05:00I've got another question concerning this. My ...I've got another question concerning this. My father-in-law left farm land in a trust for my husband, his two brothers and our nephew. It's oil land,and we receive a small, but helpful royalty check each month, divided four ways among us all. The nephew has declared bankruptcy. The lawyer for his creditors is threatening to sue my husband, who's the trustee, to force him to sell our land to pay the nephew's debts. Have we any recourse or options here? The nephew's share is 1/8. We don't want to sell oil land, and are really hoping that our nephew's bankruptcy isn't going to mess up things for the rest of us. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-51899488067344973402012-11-19T09:53:18.469-05:002012-11-19T09:53:18.469-05:00Kim,
Thank you for your Comment and Question. In...Kim,<br /><br />Thank you for your Comment and Question. In most cases the trust assets will not be accessible to pay the debts of a trustee, but it sounds like you may also be a beneficiary of the trust. The terms of the trust in the trust document are going to control what risk there may be to the trust assets and what can be done about it. You should consult with an attorney in your jurisdiction who is familiar with both trusts and bankruptcy.Kelsey & Trask, P.C.https://www.blogger.com/profile/05241677623102829217noreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-2247701519895797902012-11-18T12:59:53.757-05:002012-11-18T12:59:53.757-05:00My father just set up a trust for his estate. He p...My father just set up a trust for his estate. He put me and my two sisters as co-trustees. He has been helping support me for the last year, but he doesn't have the resources to keep on with this and take care of himself. I am just getting to the realization that my finances are completely unmanageable, and continuing to get worse due to the debt I'm incurring to get by every month. I'm considering bankruptcy. Will my being a co-trustee mean that his assets (his house) will have to be used to pay off my debts?Anonymoushttps://www.blogger.com/profile/04150568662220955702noreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-87735007369033008022011-03-09T16:28:35.344-05:002011-03-09T16:28:35.344-05:00In response to the question posed by Anonymous abo...In response to the question posed by Anonymous above:<br /><br />Placing assets in a trust and then filing bankruptcy will not protect those assets from creditors, especially if transferred to children. There are prohibitions against transferring assets prior to a bankruptcy and the look-back period is even longer for insiders (such as family members). The bankruptcy trustee has the power to invade the trust and undo the transfers. Of course there are exceptions to every rule and you should consult an attorney regarding the specific facts of your situation.Kelsey & Trask, P.C.https://www.blogger.com/profile/05241677623102829217noreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-25533553407581101142011-03-09T16:22:47.757-05:002011-03-09T16:22:47.757-05:00What if someone has placed all their assets in a T...What if someone has placed all their assets in a Trust and then files bankruptcy? The Trust is held in the children's name?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-80793101864627081262010-11-29T10:07:37.937-05:002010-11-29T10:07:37.937-05:00The power to amend a trust is clearly a very sensi...The power to amend a trust is clearly a very sensitive power that one's estate planning attorney should carefully explain and discuss with clients. There are ways to structure and limit such powers as the circumstances dictate to avoid disrupting the grantor's intent in creating the trust in the first place. This is one example of why a trust is such a delicate document that it should be custom-tailored to each individual's unique needs by an attorney who practices regularly in this area of the law.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-788849002025834990.post-43843724620689302832010-11-16T08:00:39.714-05:002010-11-16T08:00:39.714-05:00this is a wonderful post!this is a wonderful post!Unknownhttps://www.blogger.com/profile/15461876383540558734noreply@blogger.com