Monday, January 22, 2018
The Totten trust became a legally valid estate planning tool in 1904, when the New York Court of Appeals decided the Matter of Totten case. Since then, the use of these trusts has become much more commonplace. A Totten trust allows a settlor to move assets to a bank account, to which they retain unfettered access while living, so a named beneficiary can receive these assets upon the settlor's passing. These trusts are also revocable, which allows the settlor to make changes to the previously designated beneficiaries as necessary. A benefit to using this type of trust is that funds transferred to the bank account avoid the probate process, which can be timely and costly.
See Inna Fershteyn, Esq., Breaking Down the Totten Trust, BrooklynTrustandWill, January 14, 2018.
Special thanks to Alexander Evelson for bringing this article to my attention.