Active Trust

AAA

DEFINITION of 'Active Trust'

A trust where the trustee is held accountable for additional responsibilities. With an active trust, those additional responsibilities can be in respect to the control or management of the trust, collection of rent, profits, and sale proceeds; in other words the administration of the trust property.


Also referred to as a special trust.

INVESTOPEDIA EXPLAINS 'Active Trust'

An active trust is in contrast to a passive trust in which the trustee performs no active duties. A trust is a relationship where the trustor gives another person, the trustee, the right to hold title to a property or assets for a beneficiary. It is commonly used if the beneficiary is underage or has a disability that impairs them from maintaining their own finances.

RELATED TERMS
  1. Living Trust

    A property interest created during a person's life that allows ...
  2. Irrevocable Trust

    A trust that can't be modified or terminated without the permission ...
  3. Testamentary Trust

    A legal and fiduciary relationship created through explicit instructions ...
  4. Trust

    A fiduciary relationship in which one party, known as a trustor, ...
  5. Trustee

    A person or firm that holds or administers property or assets ...
  6. Trustor

    An individual or organization that gifts funds or assets to others ...
Related Articles
  1. Pick The Perfect Trust
    Retirement

    Pick The Perfect Trust

  2. Establishing A Revocable Living Trust
    Retirement

    Establishing A Revocable Living Trust

  3. Getting Started On Your Estate Plan
    Options & Futures

    Getting Started On Your Estate Plan

  4. An Estate Planning Must: Update Your ...
    Options & Futures

    An Estate Planning Must: Update Your ...

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  5. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center