Understanding Trusts: A Clear Guide for Tennessee Families

Cook Tillman
Nov 18, 2025
3 min read

When clients first begin exploring estate planning, the word “trust” can feel overwhelming. Many people aren’t sure what a trust does, whether they need one, or how different types of trusts fit into a long-term plan.

At Cook Tillman Law Group, we help families make sense of these options so they can build an estate plan that protects loved ones, minimizes complications, and clearly communicates their wishes.

What Is a Trust?

A trust is a legal arrangement that allows one person (the trustee) to hold and manage assets for the benefit of another person (the beneficiary). Trusts can be used to avoid probate, protect assets, support children or individuals with disabilities, or reduce taxes.

Ultimately, a trust gives you greater control in both life and after death over how your assets are managed and distributed.

Trusts Created During Life (“Inter Vivos” Trusts)

Some trusts are established while you are living and can be organized for flexibility, tax planning, or long-term protection. Common examples include:

Revocable Living Trust: A flexible tool that allows you to maintain control of your assets while avoiding probate and streamlining the transfer of property at death.
Community Property Trust: An option for married couples designed to convert jointly owned property into community property.
Tennessee Asset Protection Trust: A Tennessee trust that shields your assets from people who might try to collect from you later, while still giving you limited access to those assets.
Irrevocable Life Insurance Trust (ILIT): Keeps your life insurance payout from being taxed after you die, which helps your family cover expenses or receive more money.
Grantor Retained Annuity Trust (GRAT): A strategy to pass growing assets to your heirs while paying less in gift taxes.
Qualified Personal Residence Trust (QPRT): Allows you to transfer your house to family at a reduced tax value but continue living there for a certain period.
Supplemental Needs Trust: Provides financial support for a family member with disabilities while keeping them eligible for public assistance programs.
Charitable Lead Trust: A plan that donates to charity for a period before your family receives the leftover assets, often helping reduce taxes.
Charitable Remainder Trust: Provides income to you or loved ones first, and whatever is left goes to a charity when the trust ends.

Trusts Created at Death (“Testamentary” Trusts)

Other trusts are created through a will and begin only after death. These trusts can help protect beneficiaries, reduce taxes, and guide the long-term distribution of assets.

Credit Shelter Trust: Helps married couples protect more of their assets from taxes and leave more to their loved ones.
Marital Q-TIP Trust: Ensures your spouse is provided for, while allowing you to decide who inherits any remaining assets.
Minor Trust for Children: Holds and manages assets for children until they reach an appropriate age.
Supplemental Needs Trust: Can be created at death to provide financial help to a disabled family member without affecting their public benefits.
Dynasty Trust: Designed to support future generations while protecting assets from estate taxes, divorce, and creditors.
Zero Estate Tax Planning with a Charitable Lead Trust: A strategy to lower estate taxes to zero by giving money to charity for a period, then passing what’s left to your family.

Bringing Clarity to Your Estate Plan

Trusts can simplify even the most complex family or financial situations. By choosing the right type of trust, you can protect your assets, support loved ones, minimize taxes, and ensure your wishes are honored.

Our team at Cook Tillman Law Group works closely with families to build trust-centered estate plans that offer protection and peace of mind. If you’re considering adding a trust to your plan, or want to review your options, we’re here to help.