Beneficiary is the Grantor
Although a grantor of a revocable trust retains the equitable use of the trust property and is technically a trust beneficiary, it is not common to refer to the trust grantor as a beneficiary. Synonymous terms typically used to refer to the grantor of a trust are donor, settlor and trustor. The trust grantor is the person who created the trust and with few exceptions, retains all incidences of ownership rights. As the owner of the trust, the grantor has the power to modify, revoke or amend the trust at any time. Because control of the trust remains with the grantor, payment of taxes associated with trust income and capital gains are by the grantor as owner.
Since the grantor retains the right to amend a standard revocable trust, the grantor has the power to change the trust beneficiaries named in the trust at any time. Revocable grantor trust beneficiaries do not have any vested rights or entitlement in the trust, not even to statements of account. For a named trust beneficiary to have rights that vest, some from of trigger event must happened, such as the death of the grantor. A similar example is that of an adult child trying to get statements or funds from a parent's checking account. The child is not entitled to a statement and cannot get funds, since it is not their money. The same applies to the revocable trust beneficiary.
Beneficiary Receiving Funds
If the grantor of a revocable trust has designated in the trust agreement that funds are to pay currently to a beneficiary, under most state trust laws there are still no vested rights for the beneficiary. State laws vary regarding accountings and definitions of a qualified and vested beneficiary, but the general practice is that since the grantor retains the power to amend the trust and change the distribution at any time the beneficiary retains no vested rights.
Seek Professional Trust Advice
If a revocable trust beneficiary reasonably believes he has vested rights in a revocable trust, he should seek the advice of a professional trust lawyer who can review the state trust law in the jurisdiction governing the trust. Such a review is prudent practice as a review of beneficiary rights. There are unique exceptions buried within common law that may apply and a professional trust lawyer can provide guidance regarding beneficiary rights.
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