Fillable Printable Spendthrift Trust Language
Fillable Printable Spendthrift Trust Language
Spendthrift Trust Language
1
BANKRUPTCY
B 725
Fall 2008
CLASS 3
Spendthrift Trust Language
• Every beneficiary of this trust is restrained from
anticipating, assigning, transferring, selling, or otherwise
dispos ing of his or her interest in the trust estate, and
• every beneficiary is without power to anticipate, assign,
transfer, sell, or otherwise dispose of his or her interest
in the trust estate.
• No such anticipation, assignment, transfer, sale, or other
dispos ition shall be recognized by the trustee, nor shall
any attempted anticipation, assignment, transfer, sale, or
other disposition by a beneficiary of an interest in the
trust estate pass any right, title, or interest to the trust
estate.
• No interest of the beneficiaries under the trust shall be
subject to the claims of creditors or other persons, nor to
any bankru ptcy proceeding, nor to any other liabilities or
obligations of any beneficiary.
2
Essential Spendthrift Trust Language
• Every beneficiary of this trust is restrained from
dispos ing of his or her interest in the trust estate, and
• every beneficiary is without power to dispose of his or
her interest in the trust estate.
• No such disposition shall be recognized by the trustee,
nor shall any attempted dispos ition by a beneficiary of an
interest in the trust estate pass any right, title, or interest
to the trust estate.
• No interest of the beneficiaries under the trust shall be
subject to the claims of creditors or other persons, nor to
any bankru ptcy proceeding, nor to any other liabilities or
obligations of any beneficiary.
Property of the Estate to the Extent
Still in David’s Han ds
Past Distributions
Future Income
Non-Assignable. Not
Part of the
Bankruptcy Estate
§541(c)(2)
Property of
the
Bankruptcy
Estate
Remainder
Interest
David Does Not Own. The Trust
Does
Corpus
Spendthrift TrustRegular
Trust
3
Bankruptcy Estate
Bankruptcy Estate =
Any property of the deb tor at the time of filing § 541(a)(1 )
(including pro perty seized prepetition)
(including pro perty subject to alienation restrictions)
§541(c)(1)
+Property recovered as p re f erence or fra udulent tran sfer § 541(a)(3)
+ Life insurance and property debto r b ecomes entitled to
inherit w/in 180 days aft er petition § 541(a)(5)
+ Inte rest, p r ofits & proceeds o f above § 541(a)(6 )
+ Property acquired by the estate § 541(a)(7)
– Interests in Spendthrift Tr usts §541(c) (2)
– Property held in trust for anoth er § 541(d)
– Property constructively held in tru st for anothe r § 541(d)
BANKRUPTCY
B 725
Fall 2008
CLASS 3
