A Grantor: What Is It? Duties, Position, And Kinds
A Grantor: What Is It? The person or organization that establishes a trust is known as the grantor. The trust is given their possessions. A grantor, also known as a settlor, trustmaker, or trustor, may also serve as the trustee. The writer or seller of call or put options contracts, who receives the premiums for the options sold, is sometimes referred to as a grantor. Option holders purchase them through exchanges; they are in charge of covering the premium costs. Important lessons learned An organization that creates a trust and formally gives the trustee, who looks after the trust for one or more beneficiaries, responsibility over its assets is known as the grantor.
The grantor contributes the trust's assets, sometimes relinquishing ownership in the process. In some kinds of trusts, the grantor may also be the trustee, a beneficiary, or both. An options writer who receives a premium on the sale of options contracts is sometimes referred to as a grantor. Grantors as Creators of Trusts A trust is established by a person known as the grantor. The people named in the trust agreements as the recipients of the assets held inside are known as the beneficiaries. The grantor provides the trust with its assets. The related assets and money are transferred into the trust's possession.
Although it's not necessary and in certain cases impossible, the grantor may act as the trustee, overseeing the assets included in the trust. If the grantor also serves as the trustee, the trust is known as a grantor trust. Grantors continue to support non-grantor trusts, but they no longer have authority over the assets. As a result, the trust can operate independently of the grantor as a tax entity. Trusts: What Are They? For a variety of uses, trusts are intended to store cash, investments, or real estate. Testamentary trusts, living (inter vivos) trusts, revocable trusts, and irrevocable trusts are among the several types of trusts.
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