What kinds of trusts does the North Carolina Uniform Trust Code cover?

Any express trust, private or charitable, testamentary or inter vivos, whether or not the trustee accounts to the clerk of superior court — not constructive or resulting trusts, estates, payable-on-death accounts, custodial arrangements, business or voting trusts and the other arrangements the scope section lists (N.C. Gen. Stat. § 36C-1-102).

What is a power holder in a North Carolina trust?

A person other than a trustee whom the trust's terms empower to direct or consent to investments, distributions or other administration, or to hold other powers such as removing and appointing trustees (N.C. Gen. Stat. §§ 36C-8A-1, 36C-8A-2) — a fiduciary unless the terms provide otherwise (N.C. Gen. Stat. § 36C-8A-3). The trustee follows a power holder's direction and is not liable for complying absent intentional misconduct (N.C. Gen. Stat. § 36C-8A-4).

Can a North Carolina trust be decanted?

Yes. Under the North Carolina Uniform Trust Decanting Act, an authorized fiduciary with discretion over principal may distribute it to a second trust within the Act's limits (N.C. Gen. Stat. § 36C-8B-11), on written notice at least 60 days before the effective date to the qualified beneficiaries and the others the Act lists (N.C. Gen. Stat. § 36C-8B-7).

Types of Trusts in North Carolina

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Common types of Trusts in North Carolina

Revocable living Trust

Created during life and changeable anytime; commonly used to avoid probate and plan for incapacity. You keep control — so it is not asset protection.

Irrevocable Trust

Generally can't be changed or revoked once created; you give up control in exchange for benefits some irrevocable Trusts can offer, such as certain tax or planning goals. Fact-specific — for an attorney to design.

Testamentary Trust

Created by your will and funded only after death, through probate. Useful for leaving assets to minors or in stages.

Special needs (supplemental needs) Trust

Holds assets for a beneficiary with disabilities without disrupting needs-based public benefits like Medicaid or SSI, when properly drafted.

Spendthrift Trust

Includes a spendthrift provision that restrains a beneficiary's ability to transfer their interest and limits some creditors' reach (N.C. Gen. Stat. § 36C-5-502), within limits.

Charitable Trust

Benefits a charitable purpose; certain forms can combine giving with income or tax planning. Design and compliance are an attorney/advisor matter.

Trust for a pet

A North Carolina trust for the care of an animal, which the North Carolina Uniform Trust Code recognizes, as it does a trust for a noncharitable purpose, though neither has a definite beneficiary (N.C. Gen. Stat. § 36C-4-402(a)(3)).

Which type of Trust fits your goals?

Trusts are tools — the right one (if any) depends entirely on your goals, your family, your assets, and tax considerations. This page is general information, not legal advice. A free role check can show you where you stand, and a North Carolina attorney can design what fits your situation.

General information about North Carolina law, not legal advice.

Frequently asked questions

What kinds of trusts does the North Carolina Uniform Trust Code cover?: Any express trust, private or charitable, testamentary or inter vivos, whether or not the trustee accounts to the clerk of superior court — not constructive or resulting trusts, estates, payable-on-death accounts, custodial arrangements, business or voting trusts and the other arrangements the scope section lists (N.C. Gen. Stat. § 36C-1-102).
What is a power holder in a North Carolina trust?: A person other than a trustee whom the trust's terms empower to direct or consent to investments, distributions or other administration, or to hold other powers such as removing and appointing trustees (N.C. Gen. Stat. §§ 36C-8A-1, 36C-8A-2) — a fiduciary unless the terms provide otherwise (N.C. Gen. Stat. § 36C-8A-3). The trustee follows a power holder's direction and is not liable for complying absent intentional misconduct (N.C. Gen. Stat. § 36C-8A-4).
Can a North Carolina trust be decanted?: Yes. Under the North Carolina Uniform Trust Decanting Act, an authorized fiduciary with discretion over principal may distribute it to a second trust within the Act's limits (N.C. Gen. Stat. § 36C-8B-11), on written notice at least 60 days before the effective date to the qualified beneficiaries and the others the Act lists (N.C. Gen. Stat. § 36C-8B-7).

General information about North Carolina law, not legal advice.