We take a lot of time and thought into naming our children – and for good reason. The names that we provide them with will follow them throughout their lives, allowing others to gauge a bit more about them and their background, and enabling them to be successful. But while there are no laws about naming our trusts, as there are for corporations, partnerships, and the like, what we choose to call them can be almost as important.
The creator of a trust is allowed to name the trust anything that he or she so chooses. This is because unlike a legal entity (e.g. a corporation), there is no government official or regulations that must approve of the trust name.
Without any laws, most trusts tend to be named after their creator(s) along with the date of creation. An example would be “John and Jane Doe Revocable Trust dated 10/11/12.”
The name of the trust is important for many reasons, one of which is that real estate title insurance companies and banks require the name of the trust when it comes to obtaining legal documents, such as a contract to sell a trust property. When a trust doesn’t have a name, it can result in significant issues with validation of documentation such as contracts or deeds.
It is in your best interest to give your trust a name. But what should you keep in mind when naming it? Here are a few tips:
1. Try a shorter name.
It’s generally in your best interest to go with a shorter name for your trust since the longer a name the higher the chance of misspellings or issues with abbreviations due to a lack of space on forms. In other words, “Doe Family Trust dated 10/11/12” is preferable to “John R. Doe and Jane U. Doe Revocable Family Trust dated 10/11/12.”
2. Decide if you want to keep it confidential.
Sometimes you wish to keep the owner of the trust confidential for one reason or another. If this is the case for your trust, it’s best to name it something that does not include any of the names of the trust creators or individuals known to be associated with them. You could even choose to name the trust after someone’s pet turtle.
3. Ask yourself if confidentiality is actually important.
Before naming your trust after something that has nothing to do with its creators, it’s important to confirm that confidentiality is in fact very important. This is because trusts that are not named after the family at all will generate many more questions during the transaction of business for the trust. Therefore, if confidentiality is important, be prepared to answer more questions.
4. Consider keeping your business separate.
Another practical naming structure for a trust is to name it after its address and not its business. For example, if the purpose of the trust is to own and operate an apartment complex, you may wish to name the trust the same as the street address since it can help to keep the business separate. (An example would be “1234 E. Main Street Trust dated 3/4/2005.”)
5. Always pay close attention to spelling and legal names.
It’s extremely important that your name spelling matches that of what is on your license and other official documents (e.g. birth certificate, social security card, house deed, military records). This includes any suffixes, such as Jr. or III. If you fail to spell the names the same as they are on official documents, it can create a lot of questions that can greatly slow down any related processes. If there are differences between the trust and any of these documents, you must explain them in the declaration of trust. This can help to prevent future issues.
Surovell Isaacs & Levy PLC Can Help Those in VA to Create a Trust and Comprehensive Estate Plan
When you have acquired certain assets and wish to distribute them in a particular way, it’s in your best interest to speak with a qualified estate planning attorney. At Surovell Isaacs & Levy PLC, we understand what’s at stake and will work to protect our clients and that which is in their best interest through the creation and maintenance of a trust and a comprehensive estate plan. To learn more or to schedule a consultation, contact us today!