Testamentary Trust Agreement Template

What Is the Testamentary Trust Agreement?

A testamentary trust agreement is a trust created through your will that takes effect when you die. Unlike a living trust that you create and fund during your lifetime, a testamentary trust springs into existence only after your death and is funded through your estate. It provides ongoing management and controlled distribution of assets to beneficiaries.

This matters because outright inheritance often creates problems. Young beneficiaries lack the maturity to manage substantial sums. Beneficiaries with disabilities may lose government benefits if they receive assets directly. Blended families need protection against unequal treatment. A testamentary trust solves these issues by appointing a trustee to manage assets according to rules you establish, making distributions based on actual needs and circumstances rather than arbitrary dates.

 

 

Is This Testamentary Trust Agreement Right for You?

You need this agreement if you're:

• Leaving assets to minor children or young adults
• Concerned about a beneficiary's financial maturity or judgment
• Protecting a disabled beneficiary's government benefits eligibility
• Managing inheritance for beneficiaries in multiple life stages
• Creating staged distributions based on age milestones
• Providing long-term asset protection from creditors or divorce

You definitely need this agreement if:

• Your beneficiaries will receive substantial sums before age 25
• A beneficiary has addiction, mental health, or spending problems
• You're in a second marriage with children from prior relationships
• Beneficiaries would lose Medicaid or SSI with direct inheritance
• You want professional asset management to continue after death

 

 

Why Thousands Trust Legal GPS Templates

Save Money: Estate attorneys charge $2,000-$5,000 to draft testamentary trust agreements. Our template costs $35.

Save Time: Complete your trust agreement in under two hours instead of waiting weeks for attorney appointments and drafts.

Look Professional: Court-tested language and institutional-grade structure that banks and courts recognize and accept.

Keeps You Out of Court: Comprehensive provisions including Trustee Powers, Distribution Standards, and Spendthrift Protection eliminate the ambiguities that lead to litigation over estate administration.

 

 

 

Get Protected in 3 Simple Steps

Step 1: Secure Checkout

Complete your purchase through our encrypted payment system. Receive instant access to download your testamentary trust agreement template.

Step 2: Instant Download

Download your template in Microsoft Word format. Open it on your computer and save a working copy for customization.

Step 3: Fill In the Highlighted Fields

Complete the bracketed sections with your specific information. Our included how-to guide walks you through every decision point and complex provision.

 

Frequently Asked Questions

Can I use this template multiple times?

Yes. Once you purchase this testamentary trust agreement template, you can use it as many times as needed for your personal estate planning. Modify it as your circumstances change, create separate trusts for different beneficiaries, or update provisions as laws change. There are no recurring fees or usage limits.

Is this contract legally binding?

Yes, when properly completed, signed, and incorporated into your will. This template uses standard legal language accepted by courts nationwide. However, testamentary trusts must be executed as part of your last will and testament with proper witnessing and notarization according to your state's requirements. We recommend having an attorney review your completed trust to ensure it integrates properly with your overall estate plan.

What's the difference between a testamentary trust and a living trust?

A testamentary trust is created through your will and takes effect only after your death. A living trust is created and funded during your lifetime. Testamentary trusts require probate because they're part of your will, while living trusts avoid probate. However, testamentary trusts are simpler to set up initially since you don't need to transfer assets into them until after death. Choose based on your probate avoidance needs and current circumstances.

Can I name myself as trustee of a testamentary trust?

No. Testamentary trusts only take effect after your death, so you cannot serve as trustee. You must name someone else (a family member, friend, or corporate trustee) to manage the trust after you're gone. This is different from a living trust where you can serve as your own trustee during your lifetime.

How does a testamentary trust affect estate taxes?

Assets in a testamentary trust are included in your taxable estate because the trust doesn't exist until your death. However, the template includes provisions for marital deduction trusts (QTIP) that can defer estate taxes until your surviving spouse dies. It also includes generation-skipping transfer tax provisions that can minimize taxes when assets pass to grandchildren. Consult a tax advisor for planning specific to your estate size.

Can I change the trust terms after I create it?

Yes, but only while you're alive. Since a testamentary trust is created through your will, you can amend the trust terms anytime by executing a new will or codicil. Once you die, the trust becomes irrevocable and generally cannot be changed (except through limited court proceedings in some states). This makes it important to get the terms right before you pass.