Example Form: Trust Beneficiary Receipt and Release Template - Attorney Aaron Hall (2024)

Video: Learn About Receipt and Release Forms

In this video, you get answers to these questions:

  • What is a receipt and release form?
  • Who is a trustee?
  • What if a receipt and release was not signed?

Introduction

This template is provided free of charge for the benefit of the public. As with any legal form or template, you should consult with your attorney before relying on anything you read on the internet. This form may not be appropriate for your circumstances or in your jurisdiction.

You may wonder, how is a release helpful? A release provides an important benefit to the trustee. A release provides protection to the trustee in a scenario where the beneficiary later decides to sue the trustee. The trustee can use the release to show that the beneficiary released the trustee of any legal claims the beneficiary might later bring. This is the language that accomplishes this:

The undersigned does release and forever discharge [JOSHUA FRY SPEED] as Successor Trustee of the Trust, of and from any claim(s) for distributive share, and of and from all actions, claims, and demands whatsoever, for or by reason thereof, or of any other act, matter, cause, or thing whatsoever arising out of the aforesaid Trust, the Estate or the administration thereof, as well as his agents, attorneys, accountants and/or other representatives. I understand I have the right to obtain the advice of independent legal counsel, but I waive that right at this time.

Download

Download the Trust Beneficiary Receipt and Release Template Form (Microsoft Word).

Template

Waiver of Final Accounting and Consent to Distribution with Receipt and Release

The undersigned, being a Beneficiary of the [ABRAHAM LINCOLN LIVING TRUST, dated [January 1, 1850] (“Trust”) and ABRAHAM LINCOLN’S Estate (“Estate”), hereby waives the preparation and/or filing of a final accounting and fully consents to the immediate distribution to the beneficiaries.

Further, I hereby acknowledge and agree that, upon the Trustee receiving a signed Waiver of Final Accounting and Consent to Distribution from each beneficiary of the Trust, I shall receive [seventeen thousand five hundred dollars] ($17,500) as my distributive share of the Trust and the Estate, except for my share of the cash reserve, if any. This distribution represents a full and complete satisfaction of my interests in the Trust and the Estate. I understand I could retain my inheritance in a self-trusteed, spendthrift trust. I have elected not to do so.

The undersigned does release and forever discharge [JOSHUA FRY SPEED] as Successor Trustee of the Trust, of and from any claim(s) for distributive share, and of and from all actions, claims, and demands whatsoever, for or by reason thereof, or of any other act, matter, cause, or thing whatsoever arising out of the aforesaid Trust, the Estate or the administration thereof, as well as his agents, attorneys, accountants and/or other representatives. I understand I have the right to obtain the advice of independent legal counsel, but I waive that right at this time.

I affirm under penalties of perjury that the foregoing is true and correct on this the ___________ day of _______________, 1865.

____________________________________
THOMAS LINCOLN III

Drafting Notes

This form makes a number of assumptions

  • The person who created the trust and has now died is: ABRAHAM LINCOLN.
  • The trust was named: ABRAHAM LINCOLN LIVING TRUST.
  • The trust was formed on this date: January 1, 1850.
  • The beneficiary was: THOMAS LINCOLN III.
  • This beneficiary’s share was: $17,500.
  • The beneficiary is signing this document on this date: ___________ day of _______________, 1865.
  • The beneficiary is waiving any right to a final accounting.
  • The trust document allowed this beneficiary to receive the money outright (which he is doing here) or in a self-trusteed, spendthrift trust.
  • The trustee who is managing the trust was: JOSHUA FRY SPEED.

Conclusion

Disclaimers

This was prepared by attorney Aaron Hall (aaronhall.com) exclusively for educational purposes. This information may not be appropriate for your circumstances or your jurisdiction. This may be out-of-date, obsolete, or otherwise inaccurate. YOU SHOULD CONSULT WITH AN ATTORNEY BEFORE RELYING ON ANY INFORMATION HERE.

Video Transcript

What is a receipt and release form? That’s the question I’m answering today. I’m Aaron Hall, an attorney in Minneapolis, Minnesota. When there is a trust in place for an estate plan and the person who owns the trust has designated money go to a beneficiary. When that money goes to a beneficiary, the best practice is to have them sign a receipt and release. So typically a lawyer will draft a receipt and release form, which says money is going to this beneficiary. The beneficiary is acknowledging receiving that money. The beneficiary is releasing the trustee from any liability in exchange for receiving this money. Let’s talk a little bit about what does that mean?

Well, the first part there, the beneficiary acknowledges receipt of the money. There’s nothing complex about that. It’s just having a written receipt. That all right I got $50,000 from a trust. The second part is more important. The trustee is the manager of a trust. The trustee is the one who writes checks to the beneficiaries. So the trustee manages the trust and make sure money goes to the people who are supposed to get it. Well when the trustee writes a check to somebody, it’s a best practice for them to ask that person to agree not to sue the trust later and to agree that “Hey, in exchange for getting this money, we’re fair square. We’re even. Nothing further is owed of you.”

And so that’s what that release does. It’s simply the beneficiary acknowledging in exchange for getting this payment, I release you the trustee in case anything errors or other issues may have arisen. What we don’t want to happen and what this release accomplishes is we don’t want the beneficiary to take the money, go hire a lawyer and then sue the trustee for more money. So that is why the best practice is when a trustee is issuing money to a beneficiary the trustee requires that the beneficiary sign a receipt and release. They acknowledge receipt of the proceeds and they release the trustee of any legal claims that may exist so both parties can move on and not worry about the threat of a lawsuit later. Now you might be wondering what if a receipt and release wasn’t signed? Well, there’s probably still evidence of the receipt because there’s a cash check presumably. But what about the release? Well, the beneficiary technically did not release the trustee from claims, so the beneficiary could turn around and sue the trustee and say, “Hey, I’m owed more money or something, or you did something wrong.” So that is the risk that exists when no release is signed by the beneficiary.

I’m Aaron Hall. I’m an attorney in Minneapolis, Minnesota. And if you’re interested in more information like this, you can see the link to aaronhall.com in the description below. If you have other questions, feel free to add them in the comment section. And if you’d like more educational videos like this, you’re welcome to click on the subscribe button. Also, please note below there is a disclaimer, simply explaining this as an educational video. And I do these videos so you can spot issues to discuss with your attorney, not as a replacement for hiring an attorney. Thank you.

Example Form: Trust Beneficiary Receipt and Release Template - Attorney Aaron Hall (2024)

FAQs

What is beneficiary release form? ›

If a loved one has died and you are named in the Last Will and Testament as a beneficiary, the estate trustee will probably ask you to sign a release before any assets are distributed. This legal document confirms that you approve how the estate has been administered to date.

What is a receipt and release? ›

What is a receipt and release? A Receipt and Release Agreement is the means by which a beneficiary of an estate may acknowledge receipt of the property to which he is entitled, and agree to release the executor from any further liability with respect thereto.

Why is it important to get releases signed by the beneficiaries? ›

Executors want you to sign a release to ensure that they are protected from personal liability for the work they have done executing the estate. It also ensures they won't have to claw back any assets or distribute them in some new way after they've already distributed everything there is to be distributed.

How do I write a beneficiary letter? ›

A beneficiary should be addressed in a letter in the same manner as any other professional person. The letter should be addressed to the beneficiary, using her title and full name. Begin the salutation with the word “dear” and then state all relevant issues in a concise and clear manner.

What is a beneficiary receipt? ›

Obtaining a receipt serves as a written record of the disbursement that was made to the beneficiary. It is a document that can verify the exact amount and date of a distribution. The receipt and release can shelter you from future obligations of the estate or trust that would require a return of a distribution.

Can beneficiaries demand to see deceased bank statements? ›

Can Beneficiaries Demand to See Deceased Bank Statements? No, generally, beneficiaries cannot demand to see the decedent's bank statements unless they are also a personal representative of the estate. However, it is within the executor's discretion to share bank statements with beneficiaries upon request.

What is a beneficiary disbursement? ›

Disbursements are payments made from the estate to pay debts of the deceased, funeral bills, and all ongoing costs of administering the estate (funeral expenses, storage fees, and attorney's fees). As the executor, it is your responsibility to determine if the estate's assets can cover all outstanding debts and bills.

What is a trust distribution agreement? ›

The agreement outlines the assets, the provisions of the trust, where assets are going, and asks for consent from the beneficiary. The agreement documents the administration of the trust so everybody knows what's going on and they're all in agreement.

What is a receipt release and indemnification agreement? ›

A Receipt, Release, Refunding and Indemnification Agreement is a probate tool that allows the executor to distribute estate funds to a beneficiary with the promise from the beneficiary to return the funds if it later turns out they were distributed in error.

What information is a beneficiary of a will entitled to? ›

A beneficiary is entitled to be told if they are named in a person's will. They are also entitled to be told what, if any, property/possessions have been left to them, and the full amount of inheritance they will receive.

Do beneficiaries have to approve estate accounts? ›

If the executor has distributed the estate without the beneficiary having approved the accounts then they will be personally liable for any loss suffered by the beneficiary. However it is not always possible to get beneficiaries to agree to the proposed distributions.

Can a beneficiary request an interim payment? ›

If there's enough money in the estate account, an interim payment can be made to beneficiaries, with executors holding back some money to cover potential costs. These payments should be recorded by asking the beneficiaries to sign a written receipt.

How do I complete a beneficiary form? ›

Name only living persons as beneficiaries, unless you are naming a trust, your estate or an organization. Do not name the same person or organization as both a primary and secondary beneficiary. Do not use the word “or” when designating multiple beneficiaries. Do not impose any conditions on payment.

What are the 3 types of beneficiaries? ›

There are different types of beneficiaries; Irrevocable, Revocable and Contingent.

What is an example of a will statement? ›

I declare that I am in good health and possess a sound mind. This Will is made by me without any persuasion or coercion and out of my own independent decision only. I appoint Shri………………….. Son/daughter of ……………, resident of …………. to be the executor of this Will.

Can a trustee withhold money from a beneficiary? ›

Yes, a trustee can refuse to pay a beneficiary if the trust allows them to do so. Whether a trustee can refuse to pay a beneficiary depends on how the trust document is written. Trustees are legally obligated to comply with the terms of the trust when distributing assets.

How does money in a trust get distributed? ›

The grantor can set up the trust, so the money distributes directly to the beneficiaries free and clear of limitations. The trustee can transfer real estate to the beneficiary by having a new deed written up or selling the property and giving them the money, writing them a check or giving them cash.

What is the 65 day rule for trust distributions? ›

Under Section 663(b) of the Internal Revenue Code, any distribution by an estate or trust within the first 65 days of the tax year can be treated as having been made on the last day of the preceding tax year.

What an executor Cannot do? ›

An executor must be impartial. Neither he/she, nor his/her family, friends, may benefit unfairly (for example from the sale of an asset). He/She must carry out the instructions in the will, as well as reasonable instructions of the heirs. Quarrels with heirs should not interfere with his or her duties.

Should an executor keep beneficiaries informed? ›

It is a legal requirement of an Executor to keep track and produce evidence by way of accounts of all estate transactions. Estates usually take longer to administer than expected. Beneficiaries sometimes do not understand delays but by keeping them informed keeps beneficiaries happy.

Can beneficiaries see bank accounts? ›

This duty to account would not give beneficiaries a right to see the deceased's account details. In fact, this information is likely to be held by the personal representatives (even if they have it) under a duty of confidentiality owed to the deceased which persists beyond death.

Do beneficiaries pay taxes on trust distributions? ›

Trust beneficiaries must pay taxes on income and other distributions that they receive from the trust. Trust beneficiaries don't have to pay taxes on returned principal from the trust's assets. IRS forms K-1 and 1041 are required for filing tax returns that receive trust disbursements.

How long does it take to get inheritance money from a trust? ›

You cannot receive your inheritance until the estate has been properly administered. This generally takes between nine and 12 months, although it can take longer in complex estates.

What is the average trust fund amount? ›

Less than 2 percent of the U.S. population receives a trust fund, usually as a means of inheriting large sums of money from wealthy parents, according to the Survey of Consumer Finances. The median amount is about $285,000 (the average was $4,062,918) — enough to make a major, lasting impact.

Who has more right a trustee or the beneficiary? ›

And although a beneficiary generally has very little control over the trust's management, they are entitled to receive what the trust allocates to them. In general, a trustee has extensive powers when it comes to overseeing the trust.

What is a trust release? ›

A release provides an important benefit to the trustee. A release provides protection to the trustee in a scenario where the beneficiary later decides to sue the trustee. The trustee can use the release to show that the beneficiary released the trustee of any legal claims the beneficiary might later bring.

Can a beneficiary withdraw money from an irrevocable trust? ›

Can a beneficiary withdraw money from an irrevocable trust? The trustee of an irrevocable Trust cannot withdraw money except to benefit the Trust. These terms include paying maintenance costs and disbursement income to beneficiaries. However, it is not possible to withdraw money for personal or business use.

What is indemnification release? ›

A release and indemnity agreement, also called an indemnity agreement or a hold harmless agreement, is a legal contract that releases a party from specific liabilities. Essentially, one party in the contract agrees to pay for all potential losses or damages caused by the other party.

What is the difference between release and hold harmless? ›

A release and a hold harmless agreement are usually considered the same thing, as is a waiver of liability. All three have similar language and the same intent of protecting you from liability to another party. Some contracts also contain hold harmless clauses, written to protect one or both parties.

Is beneficiary entitled to see trust accounts? ›

Generally speaking, beneficiaries have a right to see trust documents which set out the terms of the trusts, the identity of the trustees and the assets within the trust as well as the trust deed, any deeds of appointment/retirement and trust accounts.

Are beneficiaries entitled to a copy of the trust deed? ›

As a general rule, a beneficiary is entitled to a copy of the trust document, any deeds of variation of the trust, deeds of appointment and trust accounts. If further information is requested, it is at the discretion of the trustee as to whether it will be provided.

Does a beneficiary have any rights? ›

Beneficiaries are entitled to an accounting–a detailed report of all income, expenses, and distributions from the estate–within a reasonable amount of time. Beneficiaries are also entitled to review and approve any compensation requested by the executor.

How do executors pay beneficiaries? ›

Before the estate is distributed, costs such as funeral, debts, legal fees, executors' expenses and inheritance tax (if applicable) are paid. The balance is then paid out to the beneficiaries of the will/intestacy. As a beneficiary, you do not usually incur costs personally.

Can an executor of a will also be a beneficiary? ›

It is a common misconception that an executor can not be a beneficiary of a will. An executor can be a beneficiary but it is important to ensure that he/she does not witness your will otherwise he/she will not be entitled to receive his/her legacy under the terms of the will.

Who distributes the money from a will? ›

Where there is a will, the personal representative is called an 'executor'. There may be more than one executor named. The executor's role is to locate all assets, pay taxes and debts, and distribute remaining money, possessions and property in accordance with the instructions in the will.

What happens if an executor does not pay beneficiary? ›

If an executor/administrator is refusing to pay you your inheritance, you may have grounds to have them removed or replaced. However, there may very well be legitimate reasons for the delay.

Can an executor pay beneficiaries before probate? ›

It is up to the executor's discretion as to whether they distribute any money before probate. However, an executor should consider how a beneficiary receiving their inheritance early could affect the rest of the estate administration.

What to do with a difficult beneficiaries? ›

This article will explore a few common difficulties that arise between executors and beneficiaries, and some tips for avoiding or addressing them.
  1. Communicate Timeline Expectations. ...
  2. Be Transparent. ...
  3. Keep the Beneficiaries Informed. ...
  4. Explain the Laws. ...
  5. Understand the Feelings Involved.
8 Jan 2018

What are beneficiary documents? ›

A beneficiary designation is a document that names the individual who will receive an asset in the case of your passing. Beneficiary designations are unique to each asset and are managed by the entity that holds said asset.

What are beneficiary forms? ›

Beneficiary designation forms are used to determine who is entitled to the defined contribution retirement plan benefits upon the death of a participant. While participants complete these forms upon entering a plan, it's often overlooked if the participant has a change in status through marriage, divorce, etc.

Can beneficiary forms be signed electronically? ›

In general, participants may indeed designate a beneficiary electronically; this was first permitted under the Electronic Signatures Act of 2000, and IRS and Department of Labor (DOL) guidance has also affirmed that electronic designations are indeed permitted, with the caveat that certain provisions in the guidance ...

What is beneficiary name example? ›

The beneficiary is defined as the person who benefits from something such as a will or a life insurance policy. An example of a beneficiary is the person who you leave your house to when you die.

How do you name a beneficiary in a trust? ›

To leave property to your living trust, name your trust as beneficiary for that property, using the trustee's name and the name of the trust. For example: John Doe as trustee of the John Doe Living Trust, dated January 1, 20xx.

Does a beneficiary have to share with siblings? ›

The law doesn't require estate beneficiaries to share their inheritance with siblings or other family members. This means that if a beneficiary receives the entire estate, then they are legally allowed to keep it all for themselves without having to distribute any of it amongst their siblings.

Is there a free will template? ›

FreeWill is one of the only free will-makers on the market, thanks to the support of our nonprofit partners. Our will forms are easy to follow, customized to you, and include instructions to make your will legally-valid based on the state where you live.

How do I create a simple will template? ›

What is a simple will?
  1. State that the document is your will and reflects your final wishes. ...
  2. Name the people you want to inherit your property after you die. ...
  3. Choose someone to carry out the wishes in your will. ...
  4. Name guardians to care for your minor children or pets, if you have them.
  5. Sign the will.
9 Feb 2021

Does Microsoft Word have a last will and testament template? ›

Does Microsoft Word have a will template? The Last Will and Testament Template, available for free, is compatible with all Microsoft Word versions from 2003 onwards.

What is a trust release? ›

A release provides an important benefit to the trustee. A release provides protection to the trustee in a scenario where the beneficiary later decides to sue the trustee. The trustee can use the release to show that the beneficiary released the trustee of any legal claims the beneficiary might later bring.

What is a receipt and refunding agreement? ›

Many of the releases signed when estate distributions are made are called "Receipt, Release and Refunding Bond". It is a legal document in which you as the heir would acknowledge receipt of a distribution, release (no claims) against the personal administrator and then agree to refund or return the money if necessary.

Can a trustee withhold money from a beneficiary? ›

Yes, a trustee can refuse to pay a beneficiary if the trust allows them to do so. Whether a trustee can refuse to pay a beneficiary depends on how the trust document is written. Trustees are legally obligated to comply with the terms of the trust when distributing assets.

Who has more right a trustee or the beneficiary? ›

And although a beneficiary generally has very little control over the trust's management, they are entitled to receive what the trust allocates to them. In general, a trustee has extensive powers when it comes to overseeing the trust.

What is the 65 day rule for trust distributions? ›

Under Section 663(b) of the Internal Revenue Code, any distribution by an estate or trust within the first 65 days of the tax year can be treated as having been made on the last day of the preceding tax year.

What is judicial settlement of estate? ›

In a judicial settlement, the court will appoint an administrator who, as the term indicates, will administer the estate. This administrator will make sure to pay the obligations of the estate. These obligations include debts, recurring maintenance and administrative expenses,and even taxes.

What is a refunding agreement? ›

The refunding agreement states that if there is an error made by the executor in the amount or type of distribution, you will give the asset back to the estate so the executor may correct the error and make proper distributions to all of the parties.

What is a bond refund? ›

By definition, the term “refunding” means refinancing another debt obligation. It is not unheard of for municipalities to issue new bonds in order to raise funds to retire existing bonds. The bonds which are issued to refund older bonds are called refunding bonds or pre-refunding bonds.

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