Trust/Estate oddity
My relative, who was disabled and taken care of by a trust fund, passed away with no will and I am the only surviving relative. I have a copy of the trust and have started to go through my relative’s bills to close out his affairs.
I found out he was paying rent to the trust for the house he lived in, which was owned by the trust. The trust states “all profits of the trust are to be paid to <my relative> on at least a quarterly basis.” The trust also states that the trust will pay for maintenance on the house, l that the purpose of the trust is not to preserve the principal, but to take care of my relative, even if that means expending all funds (in extremis). The trust does not say anything about rent or that my relative should pay for anything out of pocket. My relative was of sound mind, able to do most normal adult things except work, but was mildly autistic and didn’t question things or fight for himself, so it was possible for people to take advantage of them.
There seems to be a contradiction here. The trust was paying him quarterly, but why were they charging him rent? Isn’t rent profit, which in turn they were supposed to give to him? If the stated purpose of the trust is to care for my relative - not to make or even preserve money - this doesn’t make sense to me. Is this a typical arrangement?
If it matters, the trust is still of substantial value, and will be given to a university. I think that’s great, but I wonder if my relative was taken for a ride.
Posted Apr 19, 2025, 6:41 PM UTC