Faq

A LIVING Trust can be operated by the same person who benefits from the Trust structure. In a Private Contract in a TRUST, you can't do that. Generally there has to be a minimum of three entities. The CREATOR, the First Trustee and the Beneficiary or Certificate Holder.  The TRUST is set-up by the Creator/Settler and the First Trustee for the benefit of the Beneficiary. The EXCHANGER passes property to the trust organization by way of an "exchange" for shares of Beneficial Interest called Trust Certificate Units. This allows the newly created trust to escape having to pay a "gift" tax on receiving the initial assets.

A Living Trusts does not provide protection against the federal estate tax which can be 50% of estate assets, lawsuit or government asset seizures, neither does it have any estate, gift or income tax saving benefits, since it is revocable and deemed a Grantor Trust under the Internal Revenue Code, and is considered a Statute Trust.  The Private Contract in a Trust is irrevocable.  In a Private Contract Trust the Exchanger completely relinquishes ownership.  

Living Trusts are governed by statute law in the state where they are set up. The Private Contract Trust is a contract and as such is governed by Common Law, and is a Contract Instrument and protected under the Constitution for the united states of America.

Most Living Trusts do not qualify as contracts for the following reasons:

a) Usually there are not two different parties. One party is usually the Grantor and the Trustee. Therefore, there is no “contract” between two different parties in the sense of the constitutional meaning. Also the government generally recognizes husband and wife as one entity.

b) Living trusts are revocable, thus the Grantor never gives up control over the assets, and the Trust lacks consideration between the parties.

A Private Contract in a Trust qualifies as a contract for the following reasons:

a) There is an offer and acceptance between two or more parties who are legal age and competent.

b) There is consideration paid between the parties, including a legal object.

c) There is a termination date, usually 25 years, but the Private Contract Trust can be renewed indefinitely.

The Private Contract Trust is a Common Law "identify (lawful person) based on the unlimited right to contract, established in Equity, and not dependent upon statutory jurisdiction. Most states do have a Statute that will recognize a Common Law document.

Yes. You can operate under the control of US Common Law. If you wish to establish jurisdiction under any other State, Province or Country, simply change the situs address by appropriate Minute.

No. The trust jurisdiction is what controls how the Trust is treated.

The "situs" is the dominating or controlling address that sets the jurisdiction of the Trust. You can change the situs, if you wish the jurisdiction to be set in another State, Country or Territory.

Yes, you are free to move the situs to any location you choose. You must only document it through appropriate Minutes.

Yes, you can change the mailing address to any address in any state or Country that you prefer. Just do so with the appropriate Minutes. Some people prefer to only change the mailing address and leave the Situs address.

They are written under Common Law with no preference to jurisdiction of Statute Law. There are some Statues mentioned that give it guidelines but no jurisdiction. The Trust specifically mentions that certain Statues are only applicable if they allow the Trust to remain under the jurisdiction of Common Law.

Yes, properly written a PRIVATE CONTRACT Trust can operate almost any type of business. If more than one business is desired, there should be a Trust for each business. There is no limit to where a Trust can conduct its business. It can do business in any and all states regardless of its domicile.

A trust organization can certainly be used for so much more purposes e.g. holding property in title (vehicles, boats, house, rental property, things, etc., and more), bank accounts, setting up businesses in the name of a trust, family trust(s), insurance, utility bills, holding trust, administrator of things, management purposes. Trusts can even create wills, partnerships (if necessary), foundations, charitable ministry, etc. Contracts Trust Organizations are very versatile devices in most any circumstance setup in their usages.  

A Banking Trust deals the peculiar banking policies. A Banking Trust allows you to go to your favorite bank and open an account under the Trust name. A Family Trust is for managing your personal assets (Home, car daily purchases, etc…), similar to a Management Trust.

Set up a Private Contract Trust. Operating in your own name leaves you vulnerable to many liabilities. A frivolous lawsuit alone could wipe out the best of independent entrepreneurs.

Usually you will need an EIN number from IRS to open a bank account for the Trust; you can apply for this number “without prejudice.”  A Trust setup as a holding Trust, holding real property does not need to have an EIN, because it’s just a holding Trust.  

Nothing. Since you don't own the assets placed into the Trust, they cannot be touched by a lawsuit against you. However, you must establish the Trust before you get into legal difficulties.

The Private Contract Trust is never liable for the personal debts of Trustees.

Yes. It is a legal entity all by itself. The only liability the TRUST has is its assets. The idea is to limit how many assets you place into one Trust. (For example a trucking company with five trucks would be best served with five trusts, one for each truck.)

A Trust is NOT life insurance and and/or any other insurance for that matter.  However, when setting up life insurance you can set up the life insurance in the name of the trust.  Note: Depending on the life insurance company and their regulations, they may want the life insurance in the person’s name.  One major benefit when setting up life insurance, since life insurance is based on the Beneficiary receiving the life insurance, certainly a Trust (holding trust perhaps) can be setup to receive the life insurance and the Trust itself can assign many Beneficiaries.  This is what you call Private Asset Protection vs. Public Knowledge.  It’s all based on being private.  Note: When signing the life insurance forms the one who sets it up can sign as the Trustee of the Trust since the Trust will be the Beneficiary.       

Yes. If someone has wronged the well-being of the TRUST, the TRUST can sue in court for damages it feels are justified. A trust can do anything a natural human can do.

As a Trustee, you going bankrupt will have no effect on the assets of the TRUST because you do not own those assets.

A divorce has no effect on the assets of the Trust. Trust property cannot properly be part of a property settlement. Private Contract Trusts are best utilized by those persons who have a strong family commitment. If you feel there is a divorce in your future, it would be best for you to work out your family problems first before considering a Trust.

Yes. The party that would be interested in protecting their interest would form the TRUST and place their assets into it before committing to marriage. That way, no dispute can arise later because the assets did not belong to the individual the day they were married.

Trusts have been in use for centuries. The super rich use trusts all the time to preserve their assets and let them accumulate. Of course they do not advertise their secrets; thus their strategies, for the most part, have remained private and exclusive. Most attorneys will not inform you about Trusts either, because of their lucrative probate business. Despite this effort of suppression, more and more people are becoming aware of Trusts and benefiting from their usage.

You are free to choose any name you wish. Most people use a name that partially describes what they are doing or they simply use a name of a city or location and add the extension "Holding Trust" or "Management Trust" "Family Trust" etc…

Initially it is the person who owns the assets called the Exchanger or Settlor. After the Trust is established by the Creator and First Trustee, anyone can place additional assets into the Trust organization.

Anyone you trust. If you have expatriated and repatriated, you can be the First Trustee. If you choose not to be the First Trustee, you may request the First Trustee hire you as the Trust Manager. The daily operational duties are usually delegated to the Trust Manager.

The Creator should/can be someone neutral, whether it is a friend, associate or partner or a husband or wife if necessary. Someone, obviously, that you trust considerably. Even though they won't have any day-to-day duties of maintaining the TRUST, they can provide great initial input.  The Creator will be someone that signs the initial settlement papers (the original document) and then steps out of the picture for the most part or not depending on the setup of the TRUST.  

The Protector looks out for the interest of the Beneficiary(ies). The Protector is the person who watches over the manner in which the Trust organization is administered.  If for any reason the Protector does not think the Board of Trustees, or an individual Trustee, is operating in the best interest of the Trust Certificate Unit Holders, then the Protector can dismiss, fire and terminate the Board of Trustees, or any individual Trustee, and appoint a new Trustee in their place, or not depending on the setup of the TRUST.  

The 1st Secretary is the recording secretary for the Board of Trustees and the Trust Organization. The 1st Secretary records the minutes of the Board of Trustees meetings and does not have a vote on the Board. The most important aspect of the 1st Secretary's position is the 1st Secretary's right of approval to the correctness of the minutes before entering them as part of the official record of the Trust organization. There is a place on the minutes for the 1st Secretary to sign showing approval and recording. The 1st secretary position is usually filled by the General Trust Manager.

It can be anyone or any organization or a combination thereof, as you wish.

Yes! Any legal entity such as a Corporation, Charitable Organization, Limited Partnership or even another Trust can hold the position of the Creator, Trustee or Beneficiary. This is done when a person wishes to create multiple layers of protection by establishing more than one trust.

You will not be using the title "Grantor" in this TRUST - a grantor is someone that donates assets to a Trust and then still remains in control of them as in a revocable trust.

A Trust Certificate is similar to a Stock Certificate, but represents no beneficial interest or right, but only a future contingent interest in the asset or group of assets of the Trust. Trust Certificate Unit Holders*, (the Beneficiaries), have no vote or power over the operation of the Trust, but have the right to receive distributions of money or property from the Trust, when, in the sole discretion of the Trustee, a distribution should be made.

Protector, Trustee or any officer thereof cannot be TCU Holder anyone else or any organization you desire can be TCU Holder: (Yes, a Trust can be a TCU holder.) or depending on the setup of the TRUST a Trustee can be a certificate holder.   

Not really, however having a Will into place can certainly help organize things and all the many Trusts, if any in one document laying out the instructions of the Testator.  The Trust Organization is all an estate needs to direct the proper distribution of profit assets. There is no probate, no inheritance tax, and no gift tax no tax period. The TRUST is all an estate needs to direct the proper distribution of profit and assets. You've already transferred ownership of your assets to the TRUST. Now, it's just a matter of who controls those assets. The one thing you want to keep current is the SUCCESSOR-TRUSTEE that will take over the control of the assets upon YOUR death. The Trust will remain intact and undisturbed but control will pass to someone else that YOU designate NOW, at the time of setting up the Trust. You may desire a “Pour-over will.”  Both the Will and Trust(s) can certainly work in harmony together for the benefit of the Testator. 

If your heirs/successors/assigns are the beneficiary of the TRUST, there is no change needed. The Successor-Trustee takes over the control of the trust assets and they conduct business as usual.  If you want your heirs/ successors/assigns to CONTROL the assets like you did before your death, you need to make sure their names are established as “Successor Trustee or Successor Managing Trustee” in the appropriate Minutes. That way, in the event of your death, they automatically take over your position as First Trustee. Remember, a Trustee cannot also be a beneficiary.

No, it is NOT your Trust. You may be in control of the TRUST assets, if you are the First Trustee but it is not your Trust. It is not the Beneficiaries' Trust either. You have to be VERY CAREFUL with the wording you choose when dealing with a Trust because there are many people trying to trip you up, mainly the IRS. They may ask questions as to who owns the Trust. NO ONE OWNS THE TRUST. The Trust is a separate entity set up for the benefit of the Beneficiaries who do not have a vested interest in the assets yet. The Trust is a separate "lawful person."

No. You (the Exchanger or Settlor) will have transferred ownership of the assets to the TRUST, which may be “controlled” by you.  Your “use” of the assets (i.e. cars, house, etc.) can be considered as part of your duties as Manager or as First Trustee. Is it better to own an asset or control an asset?  If you own it, you can potentially lose it to legal or government agency attacks or frivolous lawsuits.

No. The Trust is established to take care of the Beneficiaries. You control Trust assets for the benefit of them. You cannot pay for things for yourself, such as food, clothing and entertainment, with Trust assets.

You keep minutes just like you do for any other organization. You document any transaction that takes place, i.e. selling an automobile, buying a piece of real estate, opening a business, etc. You don't have to detail every aspect of each day's activity when running a business. Just the major decisions that are made with assets, debts, etc. Did you apply for a loan, buy new equipment, etc.?   To better help you as a Managing Trustee or Trustee of the Trust Organization and manage the trust and the minutes, you can locate the Roberts Rule of Order 1876 free version in the public domain on line or pick up a book copy of Roberts Rule of Order.  

Roberts Rules of Order.  Roberts Rules of Order provide common rules and procedures for deliberation and debate in order to place the whole membership on the same footing and speaking the same language. The conduct of ALL business is controlled by the general will of the whole membership - the right of the deliberate majority to decide.  Robert's rules of order are comprehensive rules which govern meetings of political, social, and other organizations. The rules of order were developed by Civil War army officer Henry Robert based on rules used by the House of Representatives and were first printed in 1876.

Yes, you may form as many Trusts as you need. You may not, however, use your Trust as a model to copy for someone else, or resell this information, or gain from its use, directly or indirectly, by other parties.

Automobiles are a little different in each State, usually through a Bill of Sale.  But you transfer title to a Trust just as you would to another person. Homes and other real properties are transferred by deed.

As long as the items are owned by the TRUST, the insurance company will list the Trust as the policy holder. There is nothing mysterious about what you are doing. It is only unfamiliar to you at the moment. You have to start thinking of this TRUST as a living and breathing entity. It is very real and has almost as many rights as you do. Just pretend it's a living being and you'll understand it is role more easily.

The expatriated repatriated individual is no longer under the jurisdiction of the Internal Revenue Service. Neither is a Pure Trust created by such a person, nevertheless, each Trust situation needs to be considered individually as far as potential tax liabilities are concerned. It is up to each member to determine how best to approach this issue. We will help with questions you may have.

The Internal revenue Service is a collection agency for the Federal Reserve Bank, and the International Bankers (IMF). As a collection agency, it attempts to collect as much as possible from so called taxpayers. The IRS constantly tries to discourage individuals from doing anything that will save their tax dollars, the more you pay; the better it is for the IRS.  However, there is nothing immoral or illegal about paying as little as the law allows you to pay in taxes. A Judge highly respected for his legal opinions and often quoted, Judge Learned Hand, had this to say, in the case of Helvering v Gregory, 69F.2d 809: “Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes.” Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands.

Yes it can. Timely action, before you have a problem is the most important ingredient for successful asset protection planning.

A Private Contract Trust can make changes to reflect current family and business situations, as long as it’s all recorded in the Minutes of the Trust, but its initial purpose must remain as established by the Creator. 

The answer is yes.  The common belief is once an individual places an asset in an Irrevocable Trust and then is told is not able to be changed, reversed, or recovered and is final is a misconception.  It’s NOT final.  The first and foremost the Trust is, is a Contact and is a Trust thus a Contact Trust an Irrevocable Trust Organization.  Contracts can be changed, amended and rewrote, etc. at any time during its time since its creation.  The changes are simply made by the Managing Trustee and other members or Trustees voting or motion and any changes made are done in the minutes of the trust organization.  As long as it’s all recorded in the Minutes of the Trust you can place any asset in the trust and take out if necessary down the road, if needed. 

A contractual trust aka contract trust as opposed to a statutory trust, created under the Common Law. A pure trust is one in which there must be a minimum of three parties (the creator or settlor (never grantor), the trustee and the beneficiary, and each is a separate entity. A pure trust is claimed to be a lawful, irrevocable, separate legal entity.  However, the trustee may still hold beneficial interest.

Simple Asset protection is where a family or individual transfers any and all their assets e.g. property, cars, bank accounts, etc., into one trust umbrella.   This simply means the trust has deep pockets in the event of a lawsuit, possible probate, etc., because it’s under ONE TRUST.  This is no difference by having any and all title in your individual name, as the individual itself has deep pockets because all title is under ones NAME.
 
Real Asset Protection is where you place said assets e.g. assets e.g. property, cars, bank accounts, etc., into separate a trust.  Meaning if you have 3 properties you should place one property in one trust each for all 3. The same goes for cars and each for separate bank accounts.    This way in the event of a lawsuit each in every asset is in a separate trust for protection.

When it comes to funding your Trust (irrevocable or revocable, Contract Trust or Living Trust), this step is just as important as setting up your trust.  So what happens to assets left out of a Trust?
 

• Probate/Ancillary Probate - If any of your property, real property included isn't titled in the name of your trust when you die, it will need to be probated after you die.  If you own real estate in more than one state and you've failed to retitle all of it into your trust before you die, then your loved one's may be faced with probate in your home state and ancillary probate in each additional state where you own property.
• Increase in Estate Taxes - If all of your accounts are owned as joint tenants (or not) with right of survivorship or as tenants by the entirety with your spouse instead of in the name of your trust when you die, then the AB Trusts established under your trust can't be funded and you'll therefore be wasting your entire estate tax exemption.
• Disinheriting Beneficiaries - If any of your assets are owned as joint tenants (or not) with right of survivorship with one of your children instead of in the name of your trust when you die, then you'll be disinheriting all of your other children.  Meaning there is no proper heirs, successors and assigns forever present in the trust documents. 
• Guardianship or Conservatorship for Minor Beneficiaries - If you own any assets as joint tenants with right of survivorship with a minor child or grandchild instead of in the name of your trust when you die, then an adult will have to go to court in order to gain control of the account by establishing a guardianship or conservatorship for the benefit of the minor.
• Income Tax Problems - If you fail to update the beneficiary designations for your life insurance and retirement accounts to coincide with the terms of your trust before you die, then your beneficiaries won't be able to take advantage of important estate and income tax strategies or asset protection.
• Executor/Executrix, Guardianship or Conservatorship for You - If you become mentally incapacitated and any of your assets are owned in your individual name or as a tenant in common outside of your trust, then your loved ones will be faced with establishing a court-supervised executor/executrix, guardianship or conservatorship in order to be able to manage you and your assets.
• What is Durable Power of Attorney (POA)?   A durable power of attorney enables your elderly parent (called the “principal” in the power of attorney document) to appoint an “agent,” such as a trusted relative or friend, to handle specific health, legal and financial responsibilities.

 
There are two types of Power Of Attorney:

1)      POA for healthcare: Gives a designated person the authority to make health care decisions on behalf of the person.
2)      POA for finances: Gives a designated person the authority to make legal/financial decisions on behalf of the person.

Families should prepare these legal documents long before someone starts having trouble handling certain aspects of life. At the time of the signing, the elderly person establishing a durable power of attorney must be capable of deciding to seek assistance. For example, people in late stages of Alzheimer's disease may not be “of sound mind” and therefore unable to appoint a POA.

Like a trust, a Durable Power Of Attorney can be written so that the transfer of responsibilities occurs immediately. Or, the POA can state that the POA goes into effect when your elderly parent becomes incapacitated. Until that point, the elder can choose to continue to make decisions on his/her own.

A Durable Power Of Attorney is essential because if a person becomes incapacitated or incompetent without preparing this document, family and friends will not be allowed to make many important financial decisions, pay bills or make important healthcare decisions on behalf of their parent. Nor can they do crucial Medicaid planning. Anyone who wishes to undertake these tasks would have to go to court and be officially appointed the person's guardian.

There are several ways that a POA can be written, each of which enables the person who is the power of attorney to makes various, and different levels of decisions. For example, the document might say the POA has the authority to pay bills or sell certain assets. Or POA could extend to all financial decisions, including selling the family home, managing all assets, and dealing with the I.R.S.

People often balk at the thought of preparing and signing a durable power of attorney. The elder may as if he/she is losing independence, and this may be something that the person doesn't want to acknowledge. An equally fearsome thought is that the agent they appoint will go against their wishes.

The bottom line is that if you overlook the importance of funding your Trust, and other documents suggested herein, then your estate plan won't work as you or your family had anticipated and you’re Trust, and other documents will only be worth the paper it's written on.

A Private Contract in a Trust is a Trust in the form of a Contract for the benefit of a third party, known as the beneficiary or certificate holder.  If you set-up a private contract trust with somebody (or entity) you have just created a federal document aka UCC Contract Trust, which is not subject to subpoena, or review.  Anything statutory (state or federal) is always linked to the creator.  The secret is according to Article 1 > Section 10 of the Constitution, no state shall pass any law in the United States of America to impair any Obligation of Contract, a Contractual Obligation.  Meaning if you put your wishes down under a business of a Contractual Obligation it is protected by the Constitution, which was original setup under treaty. 

At some point in the near future you will need to think about taking everything out of your name and placing your property, e.g. life insurance, annuities, certificate of deposits’, stocks, bonds, mutual funds, rental property, house, and vehicles etc., into a Trust or separate trusts, whereby you are the trustee of the Trust.  For the last couple hundred years or so most bankers, politicians, presidents, the queen, attorneys, and corporations (basically power elite rulers and corporate structure etc.), have each learned to have nothing in their name, as owners of their asset, and, as a rule of thumb, will not have anything in their name.  All the property they thus CONTROL will be in Trusts.  You need to start thinking in terms of owning nothing in your name but controlling everything in a Trust!!

Have you ever wondered why the Super Wealthy, are seldom sued?  The answer is simple, their estates are totally protected! Fortunately, you, your family, your profession, and your business, can achieve this very same level of total asset privacy and protection. 

It starts by LEARNING FROM THE BEST:

“The key to this system is giving up ownership but retaining control.  For example, most people don’t believe they really own something unless they retain title to it in their own name.  The Rockefellers know this is a big mistake.  Often it is better to have your assets owned by a trust or a foundation – which you control – than to have them in your own name.”

~ The Rockefeller File by Gary Allen (1976)

In our society today you can lose everything you own, INSTANTLY and WITHOUT WARNING! Every day, all across the United States and Canada and the World people just like you and I are, LOSING EVERYTHING THEY OWN! Personal Assets, Professional Assets, Business Assets.