Testamentary Trust
Definition:
A Testamentary Trust is a trust created through a person’s **last will and testament** that only takes effect upon their death. It allows the testator to control how and when assets are distributed to beneficiaries after their passing. This type of trust is often used to provide for minor children, manage complex estates, or ensure long-term financial management under the direction of a chosen trustee.
Testamentary Trust Information
A Testamentary Trust is an estate planning tool that directs the distribution of assets according to specific terms laid out in a will. Unlike a **living trust**, which takes effect during the grantor’s lifetime, a testamentary trust becomes active only after the will is probated. The will designates the trustee—an individual or institution—responsible for managing the trust assets on behalf of the beneficiaries. These trusts are commonly used to delay inheritance until a beneficiary reaches a certain age, to provide ongoing financial support, or to manage assets for those unable to do so themselves. Because it is created under a will, the testamentary trust and its terms are a matter of public record once the estate enters probate.
Florida Legal Definition
Under **Florida Statutes Chapter 736**, also known as the **Florida Trust Code**, a **Testamentary Trust** is a trust created by the terms of a valid will and effective only upon the death of the testator. The will must clearly state the trust’s creation, identify the trustee, specify the beneficiaries, and define how the assets will be managed and distributed. Although subject to probate, testamentary trusts are governed by the same fiduciary duties and standards that apply to other trusts in Florida, including duties of loyalty, prudence, and accounting. Once established, the trustee must administer the trust according to Florida’s trust laws, ensuring compliance and protection of the beneficiaries’ interests.
How It’s Used in Practice
In practice, **Testamentary Trusts** are frequently used in Florida estate plans to ensure controlled and responsible distribution of assets. For example, parents of minor children may establish a testamentary trust to manage funds for their children’s education and living expenses until they reach adulthood. A trustee, often a trusted relative or financial professional, manages the trust according to the testator’s wishes as outlined in the will. While the trust offers control and protection for beneficiaries, it does not avoid probate since it is created through a will. Estate planning attorneys often draft testamentary trusts for clients who wish to combine oversight, structure, and post-death asset management within their wills.
Key Takeaways
- A **Testamentary Trust** is created by a will and becomes effective only after the testator’s death.
- It appoints a trustee to manage and distribute assets for the benefit of named beneficiaries.
- Under Florida Statutes Chapter 736, testamentary trusts are subject to Florida’s Trust Code and fiduciary duties.
- Commonly used to manage inheritances for minors, dependents, or individuals needing financial guidance.
- Does not avoid probate but provides structured, long-term management of estate assets after death.
Disclaimer: The information and opinions provided are for general educational, informational or entertainment purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Any information that you read does not create an attorney–client relationship with Barnes Walker, Goethe, Perron, Shea & Johnson, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.
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