Trust Company

AAA

DEFINITION of 'Trust Company'

A legal entity that acts as fiduciary, agent or trustee on behalf of a person or business entity for the purpose of administration, management and the eventual transfer of assets to a beneficial party. The entity acts as a custodian for trusts, estates, custodial arrangements, asset management, stock transfer, beneficial ownership registration and other related arrangements. A trust company does not own the assets its customers assign to its management, but it may assume some legal obligation to take care of assets on behalf of other parties.

INVESTOPEDIA EXPLAINS 'Trust Company'

A trust company or trust department is usually a division or an associated company of a commercial bank. Trusts and similar arrangements managed for eventual transfer are managed for profit, which may be taken out of the assets on an annual basis or upon transfer to the beneficial third party. There are often tax advantages associated with using trusts to transfer ownership of assets, but any trust arrangement should be made through qualified professionals that are capable of giving tax and legal advice.

RELATED TERMS
  1. Commingled Trust Fund

    Investment assets that are combined together under a common investment ...
  2. Trustee

    A person or firm that holds or administers property or assets ...
  3. Agent

    1. An individual or firm that places securities transactions ...
  4. Estate

    All of the valuable things an individual owns, such as real estate, ...
  5. Commercial Bank

    A financial institution that provides services, such as accepting ...
  6. Custodian

    A financial institution that holds customers' securities for ...
Related Articles
  1. Options & Futures

    Getting Started On Your Estate Plan

    With some preparation, you can save your heirs from paying a hefty estate tax. Here are some tips.
  2. Options & Futures

    An Estate Planning Must: Update Your Beneficiaries

    Life changes make it time to rewrite your plan's designations.
  3. Retirement

    Skipping-Out on Probate Costs

    Don't let bad estate planning lead to unnecessary costs and stress for your inheritors.
  4. Retirement

    Should You Put Your Faith In A Trust?

    Many institutions want a piece of your portfolio, but trusts can provide a one-stop shop.
  5. What's a Trust Fund?
    Personal Finance

    What's a Trust Fund?

    A trust fund is a fund comprised of a variety of assets, established by a grantor, to provide financial security to an individual, most often a child or grandchild - or organizations, such as ...
  6. Retirement

    What is a good book on creating a trust that would qualify as the beneficiary for an IRA?

    "Life And Death Planning For Retirement Benefits" has all you need and more. If you read this book, you won't need any luck.To learn more about designating a beneficiary, check out Who Is The ...
  7. Retirement

    Tired Of Banks? Try A Credit Union

    These nonprofit organizations can provide a range of services for lower fees.
  8. Investing

    What does a "5 by 5" power in a trust document mean?

    It is not uncommon that wealthy individuals are concerned with leaving large sums of money to specific beneficiaries for the fear of those individuals acting irresponsibly with access to such ...
  9. Retirement

    What are the requirements that a trust needs to meet to be qualified?

    The requirements that a trust must meet to be qualified are as follows: The trust must be a valid trust under state law or would be except for the fact that there is no corpus. The trust must ...
  10. Retirement

    Estate Planning Must-Haves For Unmarried Couples

    Society provides benefits to those who wed and punishes those who don't. Find out how to protect yourself.

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center