Totten trust


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Related to Totten trust: spendthrift trust

Totten Trust

A trust into which the grantor places banking assets such as savings accounts and certificates of deposit while maintaining control of them. That is, the grantor maintains the ability to invest, profit from, or otherwise use the assets in the Totten trust. The assets in the Totten trust pass on to the beneficiary following the death of the grantor. However, because the grantor maintains the rights of ownership (though not ownership itself), the trust is subject to the estate tax.

Totten trust

A trust in which the assets are deposited for a beneficiary but the grantor has complete control of the trust, including the right to reclaim the assets. The assets pass to the beneficiary upon the death of the grantor but are taxed as part of the grantor's estate.
References in periodicals archive ?
In a case involving Totten trusts, the court determined that the question of whether they should be subject to the elective share should not be decided by "policy in light of general common law and equitable principles" but rather the question "is a question of statutory interpretation.
149) Under the Restatement, Totten trusts would be subject to the spouse's elective share.
114) Modern data transmission, in any of its forms, is extremely accessible to the lay person and therefore provides a benefit that is not necessarily present in Totten trusts or in complicated legal property transfers.
For estate-tax purposes, the Totten Trust is included in the depositor's estate.
A trust offers many advantages over outright gifts, custodian gifts to minors, and Totten Trusts.