Dynasty Trust Template

This Dynasty Trust Agreement is executed on [Date] by [Grantor Name] ("Grantor") and [Trustee Name] ("Trustee") to provide for multigenerational wealth transfer.

Article I – Trust Creation and Funding

• Grantor transfers property described in Schedule A to Trustee to hold, manage, and distribute according to this agreement.
• Trust intended to continue for the maximum period allowed by applicable rule against perpetuities (or as permitted by perpetuities reform statutes).

Article II – Beneficiaries and Distribution Standards

• Initial beneficiaries: [Children/Descendants].
• Distributions for health, education, maintenance, and support (HEMS) of beneficiaries at Trustee’s discretion.
• Mechanism for periodic income/principal distributions; consider age-based withdrawal rights or mandatory distributions.
• Provisions for descendants adopted/after-born.

Article III – Generation-Skipping Transfer (GST) Planning

• Allocate GST exemption to trust; maintain exempt status.
• Separate GST exempt and non-exempt shares if necessary.

Article IV – Trust Protector

• Appointment of Trust Protector with powers to remove/appoint trustees, amend administrative provisions, change situs, or grant limited powers of appointment.
• Define scope of authority, standards, and limitations.

Article V – Powers of Appointment

• Primary beneficiary may hold limited power to appoint trust property among descendants or charities.
• Provide default takers in absence of exercise.

Article VI – Trustee Powers and Duties

• Invest assets prudently, diversify, retain closely held interests subject to tax considerations.
• Establish separate shares for branches of family.
• Powers to loan funds to beneficiaries or entities, purchase life insurance, form family LLCs.

Article VII – Spendthrift Clause

• Beneficiaries’ interests not assignable or subject to creditors, including divorce, bankruptcy.

Article VIII – Tax Provisions

• Trust may be treated as grantor trust during Grantor’s lifetime; specify powers causing grantor trust status (e.g., power to substitute assets, pay insurance premiums).
• Reimbursement clause for taxes paid by Grantor (optional).
• Provisions for income tax reimbursements to beneficiaries if trust becomes non-grantor.

Article IX – Trustee Succession

• Procedures for resignation, removal (with/without cause), and appointment of corporate or individual successor trustees.
• Independent trustee requirement for discretionary distributions to avoid estate inclusion.

Article X – Situs and Governing Law

• Initial situs: [State]; Trustee may change situs to favorable jurisdiction with notice.
• Governing law: laws of [State].

Article XI – Accounting and Information Rights

• Trustee to provide annual accountings to beneficiaries and trust protector.
• Limit rights of remote beneficiaries to reduce administrative burden.

Article XII – Termination

• Trust terminates when Trustee determines continuation no longer beneficial or upon expiration of perpetuities period; distribute remaining assets per descendant shares.

Article XIII – Miscellaneous

• No-contest clause (optional).
• Arbitration/mediation provision for disputes.
• Amendment of administrative provisions with protector/trustee consent.

Article XIV – Signatures

Grantor: __________________________ Date: __________

Trustee: __________________________ Date: __________

Trust Protector (if accepting role): __________________________ Date: __________

Schedules

• Schedule A: Trust assets.
• Schedule B: Beneficiary family tree.

Consult with tax counsel to ensure compliance with state perpetuities laws, GST rules, and grantor trust provisions.