Definition of Incentive trust


A legitimately restricting fiduciary relationship in which the trustee holds and deals with the benefits added to the trust by the grantor. In an incentive trust plan, the trustee must adhere to the grantor’s specific conditions to acquire trust stores.

Brief Explanation of Incentive trust

It works as a kind of “conditional inheritance” for recipients named in the trust. For instance, a maturing financial specialist needs to leave a specific amount of her wealth to a grandchild. She must ensure that the inheritance money doesn’t discourage her grandchild from seeking a professional career or advanced education. A grantor can instruct a grandchild to receive inheritance assets only after the grandchild graduates(or meets any other reasonable criteria set by the grantor).


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