As you create and manage your estate plan, you may find that it is necessary to create legal boundaries between you and your assets. This is particularly common if you are in a position of influence where the choices you make for a business or as a part of a governing body could constitute giving yourself unfair advantages. This type of trust momentarily gained nationwide exposure after then President-Elect Donald Trump declared that he was breaking with tradition and not placing his many business holdings in a blind trust. Many other presidents and lawmakers have chosen to use blind trusts to avoid the appearance of conflicts of interest as they shape the laws that govern the country.
A blind trust essentially helps shield an individual’s assets from unfair advantage, but still allow the beneficiary to receive benefits of those assets. To accomplish this, the trust must be managed by a trustee who is independent of the beneficiary, and has the ability to manage the assets without any influence or interference.
It is also important to make sure that the trustee is able to transfer, buy, or sell assets within the trust without the knowledge or influence of the beneficiary. If the beneficiary is subject to specific legislation, such as a government official, it is important to make sure that all these guidelines are followed in creation of the trust.
When used properly, blind trusts allow individuals of influence to still benefit from their assets while serving those they weild influence over fairly and justly. If you believe a blind trust may be appropriate for your estate plan, consult with an experienced attorney to help create the trust that meets your needs.
Source: Findlaw, “What Is a Blind Trust?,” accessed Sep. 01, 2017