Hi, I’m Sarah Siedentopf. I’m an estate planning and probate attorney in Atlanta, Georgia. What is a testamentary trust? A testamentary trust is a trust that is inside your will and does not come into effect until you have passed away. Now under that category, there are bazillions of different types of trusts, which might do different things. But the main point is that a testamentary trust only is in your will and only happens after you pass away.
The opposite of this is a living trust which comes into effect now, today, when you sign it, and you put things into during your lifetime. But if you had a testamentary trust you would designate in your will that you wanted a testamentary trust and what things it does but in your will you would put things into the trust as opposed to doing that before you passed away.
This can be a great possibility for flexible estate planning because you can designate that a trust only comes into existence if such and such a thing occurs, which gives you lots of flexibility, especially with changing tax laws, changing life circumstances, but a testamentary trust only comes into effect after you have passed away and is in your will. If you’ve got more questions on this subject, I would love to hear from you. Thank you.