One of the lasting legacies of the Great Depression will soon come to an end. In response to that crisis, the government greatly increased the gift and estate tax rates. Wealthy families responded, in turn, by creating dynastic trusts to hold their wealth and preserve it for future generations.
Most of the trusts created at that time have mandatory termination dates at which time the trust assets must be distributed to the residual beneficiaries.
Successfully carrying out that process will require some planning as the Wills, Trusts & Estates Prof Blog explained in "Preparing for Trust Termination."
The first challenge for many trusts and trustees will be determining the residual beneficiaries. In many cases, they could be distant relations of the original trust settlors and not the same people who currently receive regular distributions from the trusts.
Once the beneficiaries are determined, they will need to plan for how receiving the trust assets, will impact their lives and financial futures. Depending on the amount of money received, the beneficiaries' tax and estate plans could change dramatically.
Those who do not plan appropriately, could face negative consequences that could have been avoided.
If you are a residual beneficiary of a depression era trust, you should seek independent legal advice. It might not be a good idea to rely on the advice offered by the trustees and their legal advisors.
You need an attorney who will be acting only in your interests.
Reference: Wills, Trusts & Estates Prof Blog (Dec. 5, 2016) "Preparing for Trust Termination."