Cape Coral, FL asked in Estate Planning for New York

Q: When does a testamentary trust terminate?

A friend passed away leaving his house to his son in a testamentary trust. The Will reads: “The trust shall terminate upon my son attaining the age of 40”. His son is 52 so the Executrix/Trustee is transferring the property over to him. She refuses however to transfer the life insurance proceeds for which she is the designated beneficiary “in trust”. She says that the trust terminated when the son reached age 40 and claims that the proceeds are hers. She is the second wife and has both roles, i.e., Executrix and Trustee. Wouldn’t the trust terminate or expire only once the assets have all been paid to the beneficiary of the trust? How can she manage to keep the money if it is paid “in trust” ?

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2 Lawyer Answers
Michael David Siegel
Michael David Siegel
Answered
  • New York, NY
  • Licensed in New York

A: Based on your post, only the house is in trust. A designated beneficiary keeps the proceeds. If the designation is her alone and not her as trustee, she is doing the right thing.

Nina Whitehurst
Nina Whitehurst
PREMIUM
Answered
  • Estate Planning Lawyer
  • Crossville, TN

A: This involves proper interpretation of the testamentary trust provisions of the will. You should have a trusts and estates administration attorney in your area review the will.

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