A Survivorship Annuity Trust is a specialized type of trust designed to manage the distribution of annuity benefits upon the death of one or more individuals. This trust allows the surviving beneficiaries to continue receiving income from the annuity while also providing a structured means of transferring assets according to the grantor’s wishes.
The Survivorship Annuity Trust typically holds one or more annuity contracts, which are financial products that provide periodic income payments, usually during the lifetime of the annuitant. Upon the death of the annuitant, the trust ensures that the remaining benefits are paid to designated beneficiaries rather than being subject to probate or passed through the estate.
For instance, if a couple establishes a Survivorship Annuity Trust with a joint annuity, the trust can dictate that, upon the death of one spouse, the surviving spouse continues to receive the annuity payments. After both spouses have passed, the trust can then distribute the remaining assets to designated heirs or beneficiaries, ensuring that the income stream is preserved and managed according to the couple’s wishes.
In Texas, including areas like Houston, the establishment of a Survivorship Annuity Trust can offer a strategic advantage in estate planning by minimizing probate costs and delays, thereby allowing for a more efficient transfer of benefits to survivors.
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