Directed and Delegated Trusts

What is the Difference?

Understanding the difference between a “Directed Trust” and a “Delegated Trust” is not complicated if you break down the three primary functions of a trustee:
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The Administration Function – The trustee is responsible for maintaining the books and records for the trust and the signing of trust tax returns.
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The Distribution Function – The trustee is responsible for determining when a distribution comes out of the trust and is distributed to a beneficiary.
3.
The Investment Function – The trustee is responsible for determining what the trust buys, sells, and holds. This could be investable assets, closely held businesses, real estate, etc.

In a delegated trust model, the trustee is responsible for all three functions listed above. 
In a directed trust model, the functions are bifurcated or trifurcated among different advisors.

Directed Trust

Nevada has one of the best directed trust statutes in the country. 
A directed trust allows for the splitting of trustee duties into multiple roles. With Nevada’s directed trust statutes, you can appoint someone other than IconTrust to direct the investment function and even the distribution function of your trust. 

Some of the reasons you may want IconTrust to serve as directed trustee include the following:
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You want to oversee the investments of the trust assets, or you have someone you trust that you want to oversee the investments.
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You want someone other than the corporate trustee to oversee the distributions of the trust.
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You want IconTrust to serve as the corporate trustee for situs in Nevada only, and to maintain the books and records for the trust.

Delegated Trust 

IconTrust can serve as your trustee and handle all aspects of trust administration. We do not manage investments and would delegate the investment function to your current financial advisor. We would still oversee your current financial advisor and require adherence to the Prudent Investor Rule guidelines unless the trust document provides otherwise. Distributions would be made at the discretion of our Trust Committee, which is comprised of all the Trust Officers within our company. Some of the reasons you may want IconTrust to serve as full trustee, include the following:
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You want IconTrust to oversee your current financial advisor and the trust investments.
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You want distributions to be made following the guidelines you put in your trust document at the discretion of IconTrust’s Trust Committee.
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You want IconTrust to serve as the corporate trustee for situs in Nevada and to maintain the books and records for the trust.
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