Rights of a Trust Remainder Beneficiary
A trust is a legal arrangement involving a grantor, the person who funds the trust; a trustee, the party responsible for managing the trust; and a beneficiary, the party who benefits from the trust fund once the grantor has passed away. There are two types of beneficiaries: current and remainder. Current beneficiaries are entitled to receive trust funds during the existence of the trust. Remainder beneficiaries, or remaindermen, receive all assets in the trust when it terminates.
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Trust Agreement
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Trust remainder beneficiaries have the right to receive a copy of the trust document pages containing the following information: the creation of the trust by the grantor, the section(s) regarding the ultimate distribution to the remaindermen, and the signature page. The rest of the trust document is not public and a remainder beneficiary does not have the right to receive it or know its contents.
Annual Reports
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In most states, a trust remainder beneficiary has the right to receive an annual accounting of the assets and activity in the trust throughout the previous year, if he specifically requests it from the trustee. The trustee does not have an obligation to proactively seek out remainder beneficiaries and provide this information.
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Distribution of Principal
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A trust remainder beneficiary has the right to receive the amount or percentage of the trust funds as specified by the grantor in the trust agreement. The trustee may have a distribution fee that will be deducted from the trust before final distribution to the remaindermen is made.
Trust Termination
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A remainder beneficiary has the right to participate, with other trust beneficiaries, in petitioning the court to terminate the trust if the trust is no longer serving its purpose. This does not apply if the trust is revocable, meaning it can be terminated by the grantor, or if it is a charitable trust.
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References
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